Except for $2 higher in the North Central Plains, steers and heifers sold $1-$5/cwt. lower, according to the Agricultural Marketing Service (AMS). Along with seasonal pressure, wet, muddy and wintry weather curtailed receipts and demand—from Hub City Livestock Auction at Aberdeen, SD to Winter Livestock in Dodge City, to Tulia Livestock Auction in Texas, and beyond.
“Health concerns are the biggest factor, with the big temperature swings this time of year,” said AMS analysts. “Last week, temperatures were in the 80s, while lows in the 30s and 40s followed just a few days later.”
Although calf prices turned softer, Andrew P. Griffith, agricultural economist at the University of Tennessee, points out in his weekly market comments that the decline is so far less than expected seasonally.
“If prices were declining to a great extent, then that would provide more reason to wean and precondition calves this fall and winter, but the decision is made more difficult with relatively strong calf prices,” Griffith says. “The expectation of relatively inexpensive forage makes the decision more difficult. Understanding that cost of gain is highly variable across producers and production systems, it is difficult to discuss it thoroughly. However, most producers using grass will have a cost of gain between 40¢ to 60¢/lb. of gain. Value of gain is not an exact science, but it is a little easier. The current value of gain for adding 100 lbs. of weight to steers starting from 475 lbs. to 625 lbs. ranges from $1.02 to $1.24/lb. of gain if prices are locked in today and no value added premium is added.”
Week to week on Friday, Feeder Cattle futures closed an average of $3.94 lower ($3.07 to $4.62 lower).
Fed Cattle Prices Continue Steady
Negotiated cash fed cattle trade for the week was mainly steady to weak with live sales at $111/cwt. in the Northern and Southern Plains; mostly $2 lower in the western Corn Belt at $108. Dressed sales were $1 lower at $174.
“Fed Cattle prices normally have upside potential this time of year, however muddy pen conditions in all major feeding regions have left many fed cattle owners willing sellers at steady money,” explained AMS analysts.
Week to week on Friday, Live Cattle futures closed an average of $1.66 lower ($1.25 to $2.12 lower).
Likewise, the seasonals suggest wholesale beef value should start climbing sooner rather than later. As it is, Choice boxed beef cutout value was 54¢ lower week to week Friday afternoon at $202.71/cwt. Select was 54¢ higher at $192.28.
International demand continues to underpin domestic prices.
As reported in Cattle Current earlier in the week, U.S. beef exports topped $750 million in August for the first time, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF).
Specifically, August beef export value was $751.7 million, which was 11% more than the previous year, easily exceeding the previous record of $722.1 million reached in May 2018. In terms of volume, August beef exports were 7% more than the previous year at 119,850 metric tons (mt).
For January through August, beef exports totaled 899,300 mt, up 9% from a year ago, while value climbed 18% to $5.51 billion.
“U.S. beef exports continue to achieve tremendous growth, not only in our mainstay Asian markets but in the Western Hemisphere as well,” says Dan Halstrom, USMEF President and CEO. “USMEF is excited about the recent market access developments achieved by the Office of the U.S. Trade Representative (USTR) and USDA, with favorable terms being preserved in Mexico, Canada and South Korea and trade talks getting underway with Japan. A trade agreement with Japan would bring opportunities for even greater expansion as U.S. beef becomes more affordable for Japanese consumers and is back on a level playing field with Australian beef.”
Beef export value averaged $320.92 per head of fed slaughter in August, up 11% from a year ago. The January-August average was $318.66 per head, up 16%. Through August, beef exports accounted for 13.5% of total U.S. beef production, which was 0.7% more than the previous year.
Friday to Friday Change*
Weekly Auction Receipts
|
Receipts Oct. 12 |
Auction (head) (Change) |
Direct (head) (Change) |
Video/net (head) (Change) |
Total (head) (Change) |
|
195,000 (-54,600) |
32,500 (-15,100) |
6,100 (-33,100) |
233,600 (-102,800) |
CME Feeder Index
| CME Feeder Index | Oct. 11 | Change |
| $157.48 | – $0.70 |
*Thursday-to Thursday for CME Feeder Index
Cash Stocker and Feeder
North Central
| Steers-Cash | Oct. 12 | Change |
| 600-700 lbs. | $166.47 | + $0.18 |
| 700-800 lbs. | $162.93 | – $0.68 |
| 800-900 lbs. | $161.52 | + $1.93 |
South Central
| Steers-Cash | Oct. 12 | Change |
| 500-600 lbs. | $161.11 | – $2.40 |
| 600-700 lbs. | $156.82 | – $4.02 |
| 700-800 lbs. | $154.90 | – $4.59 |
Southeast
| Steers-Cash | Oct. 12 | Change |
| 400-500 lbs. | $157.71 | – $2.66 |
| 500-600 lbs. | $148.54 | – $3.27 |
| 600-700 lbs. | $141.54 | – $1.42 |
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
| Boxed Beef (p.m.) | Oct. 12 ($/cwt) | Change |
| Choice | $202.71 | – $0.54 |
| Select | $192.28 | + $0.54 |
| Ch-Se Spread | $10.43 | – $1.08 |
Futures
| Feeder Cattle | Oct. 12 | Change |
| Oct | $154.700 | – $3.075 |
| Nov | $154.625 | – $3.600 |
| Jan ’19 | $149.750 | – $4.625 |
| Mar | $148.975 | – $4.475 |
| Apr | $149.800 | – $4.175 |
| May | $149.875 | – $3.975 |
| Aug | $152.325 | – $3.800 |
| Sep | $152.175 | – $3.825 |
| Live Cattle | Oct. 12 | Change |
| Oct | $112.325 | – $1.475 |
| Dec | $116.175 | – $1.975 |
| Feb ’19 | $120.400 | – $2.125 |
| Apr | $121.975 | – $1.625 |
| Jun | $114.875 | – $1.775 |
| Aug | $113.050 | – $1.625 |
| Oct | $114.225 | – $1.575 |
| Dec | $115.550 | – $1.475 |
| Feb ’20 | $116.875 | – $1.250 |
| Corn futures | Oct. 12 | Change |
| Dec | $3.736 | + $0.054 |
| Mar ’19 | $3.856 | + $0.056 |
| May | $3.926 | + $0.056 |
| Jul | $3.976 | + $0.054 |
| Sep | $3.996 | + $0.042 |
| Dec | $4.044 | + $0.040 |
| Oil CME-WTI | Oct. 12 | Change |
| Nov | $71.34 | – $3.00 |
| Dec | $71.18 | – $3.08 |
| Jan ’19 | $71.08 | – $3.07 |
| Feb | $70.99 | – $3.06 |
| Mar | $70.94 | – $3.03 |
| Apr | $70.89 | – $2.99 |
Equities
| Equity Indexes | Oct. 12 | Change |
| Dow Industrial Average | 25339.99 | – 1107.06 |
| NASDAQ | 7496.89 | – 291.56 |
| S&P 500 | 2767.13 | – 118.44 |
| Dollar (DXY) | 95.26 | – 0.37 |