Cattle feeders remain frustrated as market fundamentals suggest the market is ready to rally, but packers continue to dig in their heels. Last week they bought just 45,000 head in the cash market at prices $1 higher. Many feeders passed on bids of $126, and Texas reported no sales last week under Mandatory Price Reporting. Cattle feeders are convinced packers will need more cattle this week, and asking are at least $130.
Northern cattle are coming to market at least 50 to 100 pounds light, the result of this winter’s wet, frigid conditions. Cattle feeders likely won’t be able to recapture the lost weight as cost of gains are rising and winter refuses to loosen its grip. Yet the beef tonnage lost to winter weather will add support to both fed cattle prices and wholesale beef values.
USDA raised its price outlook for 2019 during last week’s Outlook Forum, now forecasting Five-Area steer prices to average $115 to $122, up slightly from last year’s $117 average. USDA says beef demand is expected to remain strong.