Cattle Current Daily-July 24

Cattle Current Daily-July 24

Cash fed cattle sales ended the week steady to $2 higher at mostly $120/cwt. Dressed trade was steady to $1 lower at $189-$190.

Cattle futures tottered to minimal gains on Friday, gaining back some of the previous day’s losses. 

Live Cattle futures closed an average of 27¢ higher (7¢ to 55¢ higher).

Feeder Cattle futures closed an average of 81¢ higher (50¢ to $1.10 higher).

Choice boxed beef cutout value was 74¢ lower Friday afternoon at $206.91/cwt. Select was 78¢ lower at $194.80.

Monday’s open may feel a little like crawling on a new horse in a dust storm. On one hand, cash fed cattle trade was steady to stronger at the end of the week. On the other, July feedlot placements were 16% higher (see below), well outside the bounds of what analysts expected.

******************************

 Major U.S. financial indices closed slightly lower on Friday with pressures that included lower oil prices and sagging sales at General Electric.

The Dow Jones Industrial Average closed 31 points lower. The S&P 500 closed fractionally lower. The NASDAQ closed 2 points lower.

******************************

Despite marketing more fed cattle in June than the number of cattle placed, it’s going to be hard to bet against Friday’s monthly Cattle on Feed pressuring Cattle futures prices, at least early on. Placements were significantly more than many anticipated, supported by the mid-year Cattle report that suggests continuing expansion, albeit at a slowing pace.

Cattle on feed July 1 of 10.8 million head was 4.5% (465,000 head) more than a year earlier, which is 1%-2% more than estimates ahead of the report. The mix includes 11% more heifers and 1% more steers.

Placements in June of 1.77 million head were 16.1% more (245,000 head) than the previous year. That’s substantially more than most analysts were expecting ahead of the report. Of that, 46% were placed on feed weighing 700-899 lbs.; another 15% weighing 900 lbs. or more. There were 21% placed at weights less than 600 lbs.

Marketings in June of 1.99 million head were 4.0% (77,000 head) more than at the same time a year earlier, which was in line with pre-report estimates.

The July Cattle report from USDA offers a foundation to the increased numbers, courtesy of an expanding cowherd. Arguably, that’s about all it does. Though eagerly anticipated by many for clues about continued herd expansion, it’s difficult to draw conclusions since USDA failed to provide a similar report a year earlier—all that stumbling around with the budget. So, they provide comparisons to the last mid-year report in 2015.

Those comparisons are shared here, but again, it’s hard to take away anything concrete. At most, and it’s still speculative you could make the case that herd expansion continues, but not as aggressively as that past couple of years. That conjecture is based on the number of beef replacement heifers at the beginning of the year compared to the prior year, the number of beef replacements in July, along with increased heifer slaughter and the increased percentage of heifers placed on feed.

July 1 Cattle

Cattle inventory of 102.6 million total cattle and calves is 4.5% (4.4 million head) more than July of 2015.

32.5 million beef cows are 6.6% (2 million head) more than in 2015. The 31.2 million cows on Jan. 1 were 3% more than a year earlier.

Beef replacement heifers of 4.2 million head are 2.1% less than two years earlier. The 6.4 million beef replacements at the start if the year were 1% more than at the beginning of 2016.

Estimated calf crop for this year of 36.3 million head is 6.5% (2.2 million head) more than in 2015. Cattle on feed for all feedlots July 1 are 5.9% (700,000 head) more than at the same time in 2015.

For further perspective, consider the 37 million head of cattle estimated to be outside of feedlots July 1. The last most similar number in recent years was the 36.7 million head outside of feedlots in July of 2011.

Comparing the mot recent midyear Cattle report to that of 2011:

• 1.6 million head (+2.6%) more total inventory.

• 1.1 million head (+3.5%) more beef cows.

• 500,000 head more (+ 11.9%) beef replacement heifers.

• Calf crop estimated 800,000 head (+2.3%) larger.

• Cattle on feed July 1 (all feedlots) 600,000 more head (+4.9%).

2017-07-23T17:49:18+00:00

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.

This Is A Custom Widget

This Sliding Bar can be switched on or off in theme options, and can take any widget you throw at it or even fill it with your custom HTML Code. Its perfect for grabbing the attention of your viewers. Choose between 1, 2, 3 or 4 columns, set the background color, widget divider color, activate transparency, a top border or fully disable it on desktop and mobile.