Fed Cattle Steady, COF 2% Higher
Cash fed cattle traded steady in both the south and north this week at $124, with cattle on a dressed basis trading at $198 to $199.
USDA’s Cattle on Feed report estimated 12.0 million head in feedlots with capacity of 1,000 head or more on Jan. 1, 2020, an increase of 2% over the same month a year ago. Placements were 3% higher and marketings were 11% lower.
The Choice beef cutout closed Friday at $215.32 an increase of $1.15 for the week. Select closed at $211.20 a decrease of $1.55 for the week. The Choice/Select spread closed at $1.55.
Feeder cattle at auctions sold mixed. Steer and heifer calves in the Southeast sold steady to $2 higher, while those in other areas were steady to $3 lower.
Agricultural Marketing Service reporters said the market was most active on “lightweight cattle, in light flesh, as numbers of those cattle are not as plentiful as their heavier mates.”
AMS reporters said winter weather conditions across several states curtailed receipts.
“Farmer feeders in the Midwest were ready to buy cattle this week as cattle appeared to take the weather in stride and hardened up in the extreme winter conditions,” AMS said. “In Missouri very few auctions were held in the in the north half of the state and by mid-week even those in the south were being affected by the winter weather. Transporting cattle was not the easiest thing to do and many ranchers were mainly concerned with getting cattle fed in the harsh conditions.”
Cattle futures had a rough week which added pressure to the market on heavier cattle suitable only for finishing. For the week, Feeder Cattle futures finished $3.50 to $5.37 lower, while the Live Cattle contracts were $1.50 to $3.18 lower.
Thursday’s monthly Livestock Slaughter report revealed that while Federally Inspected (FI) steer slaughter was 2% below the previous year and 3-year average, heifer slaughter was nearly 7% above a year ago and nearly 16% larger than the 3-year average.
“Coupled with FI beef cow slaughter almost 6% above a year ago and nearly 15% above the 3-year average, leaving no doubt ranchers have been moving the factory through the red meat pipeline in 2019,” AMS said.
Cattle Slaughter under FI estimated at 647,000 for the week, 16,000 more than last week and 39,000 more than a year ago.
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