Despite continued futures price pressure for most of the week, and lower negotiated cash fed cattle prices, calves and feeders mostly found increased support.
Steers and heifers sold from $1/cwt. lower to $3 higher, according to the Agricultural Marketing Service (AMS). Those analysts note demand was strongest for lightweight calves suited for summer grazing.
Weather lightened auction receipts again with an arctic blast and heavy rains limiting movement from southern Oklahoma through the Southeast.
“The mud has made it impossible to get trucks and trailers in and out of fields, not to mention that it has resulted in poorer cattle performance the past couple of months,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “On top of tough weather conditions, feeder Cattle futures have been languishing for three weeks towards the bottom of the trading range.”
Futures optimism increased toward the end of the week, though, as oversold conditions helped set the stage for stronger prices.
Week to week on Friday, Feeder Cattle futures closed an average of $2.61 higher (1.70 to $3.87 higher).
Looking further ahead, USDA’s Agricultural Projections to 2029 suggest calf prices this year will be slightly higher than last year and the lowest for the next decade. This year’s projected farm calf price of $160/cwt. is the lowest of the projection period, which ranges from $165.17 (2028) to $180.88 (2023).
Fed Cattle Prices Sag
Negotiated cash fed cattle trade ended the week $2-$3 lower at $119/cwt. on a live basis and $3 lower in the beef at $190.
“Most of the cattle coming off feed today are profitable, and with the dip in feeder cattle prices the past few weeks, current placements have a good chance of being profitable,” Griffith says.
Except for 50¢lower in spot Feb, Live Cattle futures closed an average of 63¢higher week to week on Friday.
The latest World Agricultural Supply and Demand Estimates (WASDE) increased projected beef production for this year 40 million lbs. more than the January estimate at 27.48 billion lb.
“The beef production forecast is raised from the previous month on higher cattle slaughter and heavier cattle weights in the first half of the year. However, the forecasts for second-half beef production is reduced on lower anticipated steer and heifer slaughter in the second half of the year,” explain USDA analysts. “This reflects a smaller number of cattle outside feedlots implied by the Jan. 1 Cattle report which results in lower placements during 2020.”
Total red meat and poultry production was projected 634 million lbs. more at 108.79 billion lbs.
The annual fed steer price (five-area direct) was projected at $117/cwt.: $123 for the first quarter; $118 for the second; $112 for the third; $114 for the fourth quarter.
In the meantime, Choice boxed beef cutout value was $2.03 lower week to week on Friday at $208.09/cwt. Select was $1.82 higher at $205.71.
“Despite the struggle of cutout prices during a time when beef demand is slack, retail prices started off the year extremely strong,” Griffith explains. “The retail price of Choice beef for January was nearly $6.06/lb., which was 20¢/lb.higher than it was in January of 2019. The all fresh retail beef price for January was nearly $5.94/lb., which was 24¢ higher.”
Friday to Friday Change
Weekly Auction Receipts
| Feb. 14 | Auction | Direct |
Video/net |
Total |
|
191,800 (+5,200) |
30,000 (+22,100) |
5,000 (-19,900) |
226,800 (+7,400) |
CME Feeder Index
| CME Feeder Index* | Feb. 13 | Change |
| $140.60 | – $0.03 |
*Thursday-to Thursday for CME Feeder Index
Cash Stocker and Feeder
North Central
| Steers-Cash | Feb. 14 | Change |
| 600-700 lbs. | $158.15 | – $0.35 |
| 700-800 lbs. | $144.22 | – $2.47 |
| 800-900 lbs. | $136.55 | – $1.44 |
South Central
| Steers-Cash | Feb. 14 | Change |
| 500-600 lbs. | $167.52 | + $4.31 |
| 600-700 lbs. | $150.35 | + $0.65 |
| 700-800 lbs. | $139.93 | + $0.42 |
Southeast
| Steers-Cash | Feb. 14 | Change |
| 400-500 lbs. | $160.74 | + $4.16 |
| 500-600 lbs. | $147.69 | + $1.26 |
| 600-700 lbs. | $135.15 | + $0.31 |
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
| Boxed Beef (p.m.) | Feb. 14 ($/cwt) | Change |
| Choice | $208.09 | – $2.03 |
| Select | $205.71 | + $1.82 |
| Ch-Se Spread | $2.38 | – $3.85 |
Futures
| Feeder Cattle | Feb. 14 | Change |
| Mar | $138.525 | + $3.325 |
| Apr | $141.375 | + $3.875 |
| May | $143.200 | + $3.625 |
| Aug | $150.200 | + $2.325 |
| Sep | $151.500 | + $2.025 |
| Oct | $152.350 | + $2.000 |
| Nov | $152.550 | + $1.700 |
| Jan ’21 | $149.325 | + $2.025 |
| Live Cattle | Feb. 14 | Change |
| Feb ’20 | $120.825 | – $0.500 |
| Apr | $120.325 | + $0.525 |
| Jun | $112.000 | + $0.725 |
| Aug | $110.475 | + $0.600 |
| Oct | $113.650 | + $0.550 |
| Dec | $118.100 | + $0.500 |
| Feb ’21 | $120.750 | + $0.525 |
| Apr | $122.175 | + $0.825 |
| Jun | $115.050 | + $0.800 |
| Corn | Feb. 14 | Change |
| Mar ’20 | $3.776 | – $0.058 |
| May | $3.820 | – $0.064 |
| Jul | $3.854 | – $0.068 |
| Sep | $3.842 | – $0.052 |
| Dec | $3.886 | – $0.054 |
| Mar ’21 | $3.980 | – $0.046 |
| Oil CME-WTI | Feb. 14 | Change |
| Mar | $52.05 | + $1.73 |
| Apr | $52.32 | + $1.77 |
| May | $52.60 | + $1.78 |
| Jun | $52.79 | + $1.75 |
| Jly | $52.87 | + $1.65 |
| Aug | $52.85 | + $1.54 |
Equities
| Equity Indexes | Feb. 14 | Change |
| Dow Industrial Average | 29398.08 | + 295.57 |
| NASDAQ | 9731.18 | + 210.67 |
| S&P 500 | 3380.16 | + 52.45 |
| Dollar (DXY) | 99.16 | + 0.44 |