Note: Futures and equity markets were closed yesterday. As well, some AMS reports were unavailable due to the holiday.
Negotiated cash fed cattle prices last week were $156/cwt. on a live basis in the Southern Plains and Nebraska, where dressed prices were $252. Live prices in the western Corn Belt were $157-$159.
Choice boxed beef cutout value was 81¢ higher Monday afternoon at $277.43/cwt. Select was 34¢ lower at $256.55/cwt.
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Historically low hay stocks could prompt more beef cow liquidation this winter, says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments.
He points out Dec. 1 hay stocks for the nation were 16.4% less than the previous 10-year average at 71.9 million tons, in the recent USDA Crop Production report. It was the least on record going back to 1973. Peel notes hay production last year was the lowest on record in data that began in 1974.
“Each of the top 10 states for hay stocks was down compared to the 10-year average and collectively were down 20.8% from the 2012-2021 average Dec. 1 stocks level,” Peel says. “The largest hay stocks on December 1 were in Texas — 25.8% below the 10-year average for the state. Other top 10 states were down from the 10-year average ranging from Tennessee (down 10.9%) to Oklahoma (down 32.7%).”
Combined total hay production in the top 10 states represents 43% of U.S. total hay production and was down 18.7% compared to the 10-year average for those states, according to Peel. He adds that eight of the top 10 beef cow states are among the top 10 hay production states.
“The December storm already will have taken a chunk out of the reported Dec. 1 hay stocks,” Peel says. “New forage production is several months away in the south and even farther away in northern regions.”