Cash fed steer prices reached record highs two weeks ago, and the trajectory – fueled by strong demand and restricted head counts – was predestined to hit the seasonal ceiling.
Moving forward, lower quality grades in May and lighter carcass weights combined with shorter fed cattle supplies may be expected, driving premiums into the high-quality cattle and beef markets.
A broad view of recent carcass cutout values shows plenty of strength in wholesale boxed beef prices. To contrast current values to a year ago, CAB and commodity Choice cutouts are 14% higher.
As you’re contemplating the future impact of today’s genetic decisions, consider the marketability of both feeder calves and potential replacement heifer progeny.
With current fed cattle carcass weights 16 lb. lighter than a year ago marbling achievement, on average, is likely to underperform in contrast to the past two years.
From a cash price perspective, both cattle and beef markets continue on a relatively bullish run the past few weeks. Meanwhile, winter weather has hindered feedyard performance this season.
From a cattlemen’s perspective fed cattle prices have been “just good enough” since the first of the year, only showing some spark as recently as last week with the nearly $3/cwt. move.
Focusing on carcass quality can allow feeder cattle buyers to factor in higher returns based on better-than-projected feedlot performance and/or carcass quality premiums than average.
