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 |