Cattle Current Daily-Sept. 11, 2018

Cattle Current Daily-Sept. 11, 2018

When the final counting was done last week, negotiated cash fed cattle prices were steady to $1 higher at mostly $107-$108/cwt. on a live basis and at $170 in the beef.

Those steady to higher prices helped Live Cattle futures firm on Monday, while Feeder Cattle closed narrowly mixed.

Except for unchanged in near Dec, Live Cattle futures closed an average of 32¢ higher.

Feeder Cattle futures closed narrowly mixed, 45¢ lower to 22¢ higher.

Wholesale beef values were weak on Choice and higher on Select, with moderate to fairly good demand and light to moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 26¢ lower Monday afternoon at $206.30/cwt. Select was $1.84 higher at $198.93.

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Major U.S. financial indices closed mixed Monday, between some recovery in tech stocks, but lingering concerns about trade.

The Dow Jones Industrial Average closed 59 points lower. The S&P 500 closed 5 points higher. The NASDAQ was up 21 points.

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“Cattle prices decline from 2018 to 2020 as production continues to increase. Live hog prices remain below $45 cwt. for three straight years, as production continues to expand and tariffs slow growth in U.S. exports,” say analysts with the Food and Agricultural Policy Institute (FAPRI) at the University of Missouri.

That’s one of the conclusions from the recently released Baseline Update for U.S. Agricultural Markets. The update is to the annual U.S. Baseline Outlook published each spring, which provides 10-year projections. The Update looks through 2023.

FAPRI estimated the average price of a 600-650 lb. feeder steer (basis Oklahoma City) at $158.51/cwt. this year, declining as low as $141.06 in 2020; rising each year after that to $162.14 in 2023.

Prices for fed steers (5-area Direct) are projected at $116.59 this year, declining as low as $110.19 in 2020, then ultimately increasing to $119.99 in 2023.

For context, FAPRI forecasts peak beef cow numbers in 2019 at 31.8 million head, just 100,000 head more than the start of this year. Then numbers continue to decline through 2023 at 30.8 million head.

Likewise, total cattle and calves are projected to plateau next year at 94.6 million head—200,000 more than this year—before declining to 91.4 million head in 2023.

Incidentally, peak beef production is estimated to plateau at 28.32 billion lbs. in 2021, then decline to 28.01 billion in 2023. That would still be more than next year’s estimated production of 27.92 billion lbs.

2018-09-10T19:37:39-05:00

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