Cattle Current Weekly Highlights—Week ending April 16, 2021

Cattle Current Weekly Highlights—Week ending April 16, 2021

Based on weekly auctions monitored by Cattle Current, cash calf and feeder cattle prices started last week mainly steady to higher and then lost ground as the week progressed, except for parts of the Southeast.

Nationwide, Steers and heifers sold $1-$3/cwt. lower, according to the Agricultural Marketing Service. The exception was steady to $2 higher in the Southeast.

Declining Feeder Cattle futures, beneath the weight of increasing feed costs, helped pressure cash prices.

Week to week on Friday, Corn futures closed an average of 9.6¢ higher through the remaining two old-crop contracts and then an average of 16.4¢ higher through the first four new-crop contracts. 

Week to week on Friday, Feeder Cattle futures closed an average of $4.93 lower.

Drought also applied pressure to calf and feeder cattle prices in some regions.

“Demand for grass cattle was slightly lower this week as concerns over drought conditions and higher feed prices weighed on the market,” explained the AMS reporter on hand for Wednesday’s weekly sale at Public Auction Yards in Billings, MT.

With all of that said, in the latest Livestock, Dairy and Poultry Outlook, USDA’s Economic Research Service (ERS) increased forecast feeder steer prices for the remainder of this year, based on recent price strength. Compared to the previous month, projected feeder steer prices (basis Oklahoma City) increased $6 in the second quarter to $140.00/cwt., $3 in the third and fourth quarters to $143. The annual average feeder steer price was projected $3.50 higher at $140.

“Prices are improving, but I think we will continue to see producers cut into their cow herds based on high feed prices and drought,” says David Anderson, Extension livestock economist at Texas A&M University, in the latest Texas Crop and Weather Report. “There is typically less beef production on higher feed prices, historically, and drier-than-normal weather outlooks will be a factor going forward.”

Fed Cattle Prices Edge Higher

Negotiated cash fed cattle prices were mainly steady to higher last week, but short of what many hoped.

For the week, live prices were steady in the Texas Panhandle at $120/cwt., steady to $1 higher in Nebraska at $123-$124, unevenly steady in Colorado at $122 and at $1 lower in the western Corn Belt at $122-$124. Dressed prices were $1 higher in Nebraska at $196; steady to $1 lower in the western Corn Belt at $194-$196.

The recent change in basis is likely part of the reason for less robust price progress, as some feedlots have more incentive to trade at the current price.

Week to week on Friday, Live Cattle futures closed an average of $2.41 lower ($1.45 lower at the back to $3.40 lower toward the front). Lean Hog futures added pressure with weekly U.S. net pork export sales running out of significant steam.

Also, while total cattle slaughter was less than expected year over year in the first quarter, it was still the second most on record, according to USDA. ERS analysts say part of that stemmed for more cow slaughter than anticipated. Those analysts expect fed cattle marketings and beef production to increase in the second half of the year, leading to a year-over-year increase of about 60 million lbs.

Beef Prices Up

Wholesale beef prices continued their month-long march higher last week, but at a more moderate pace. Choice boxed beef cutout value was $3.88 higher week to week on Friday at $276.05/cwt. Select was $5.03 higher at $269.10.

In the latest issue of In the Cattle Markets, Anderson says it’s worth remembering beef demand strength, heading into the pandemic.

“A growing economy, falling unemployment, and consumer preferences trending towards higher USDA quality grade beef were building demand,” Anderson says, in the latest issue of In the Cattle Markets. “…The retail all fresh beef demand index scored 119 for 2020, the best in 20 years. That index is calculated using per capita consumption, USDA, BLS retail prices, which only reflect grocery store prices. Regardless, it suggests that we exit the pandemic with a strong base of beef demand.”

Moreover, Anderson says the approaching grilling season, further opening of U.S. businesses and pent-up consumer demand promise to boost prices.

Week to Week Change

Weekly Auction Receipts

Apr. 19 Auction Direct

Video/net

Total
 

217,500

(-10.700)

56,200

(+5,900)

18,100

(-47,000)

291,800

(-51,800)

 

CME Feeder Index

Thursday through Thursday…

CME Feeder Index* Apr. 15 Change
  $141.68 –  0.06

 

Cash Stocker and Feeder

North Central

Steers-Cash Apr. 19 Change
600-700 lbs. $166.01 +  $1.26
700-800 lbs. $150.19 –   $2.05
800-900 lbs. $137.53 –   $5.16

South Central

Steers-Cash Apr. 19 Change
500-600 lbs. $169.09 –   $2.20
600-700 lbs. $154.97 –   $1.43
700-800 lbs. $143.26 –   $2.79

Southeast

Steers-Cash Apr. 19 Change
400-500 lbs. $167.74 –   $1.24
500-600 lbs. $156.42 +  $0.39
600-700 lbs. $146.10 –   $2.25

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Apr. 16 ($/cwt) Change
Choice $276.05 + $3.88
Select $269.10 + $5.03
Ch-Se Spread $6.95 –  $1.15

 

Futures

Feeder Cattle  Apr. 16 Change
Apr $139.625 –  $5.125
May $143.725 –  $5.900
Aug $154.550 –  $5.400
Sep $156.200 –  $4.675
Oct  $157.275 –  $4.275
Nov $157.825 –  $4.150
Jan ’22 $156.050 –  $5.125
Mar $155.750 –  $4.800

 

Live Cattle   Apr. 16 Change
Apr $120.850 –  $2.575
Jun $119.175 –  $3.400
Aug $119.150 –  $3.250
Oct $122.500 –  $3.200
Dec $126.225 –  $2.475
Feb ’22 $129.225 –  $2.000
Apr $130.550 –  $1.625
Jun $125.550 –  $1.750
Aug $125.100 –  $1.450

 

Corn  Apr. 16 Change
May $5.854 + $0.082
Jly $5.736 + $0.110
Sep $5.294 + $0.188
Oct $5.122 + $0.158
Mar ’22 $5.190 + $0.156
May $5.232 + $0.152

 

Oil CME-WTI Apr. 16 Change
May $63.13 + $3.81
Jun $63.19 + $3.84
Jly $63.09 + $3.82
Aug $62.81 + $3.77
Sep $62.38 + $3.67
Oct $61.88 + $3.54

 

Equities

Equity Indexes Apr. 16 Change
Dow Industrial Average  34200.67 +    400.07
NASDAQ  14052.34 +    152.16
S&P 500    4185.47 +       56.67
Dollar (DXY)         91.54 –          0.62
2021-04-19T14:33:45-05:00

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