Hulett: Weather Slows Beef Production in the South

Beef production slowed to a virtual standstill due to extreme winter weather in the South last week.  The load on the supply of electricity and natural gas limited the packing plants in the South region from running at full capacity.  The packers did not have a need for extra inventory with interrupted harvest schedules. 

The inventory taken on was steady at $114 on limited volume.   Due to the extreme conditions the loss of pounds had producers willing to push for a more optimal cattle trade into next week. 

Steady money on cash trade at $114, was the result of the trade in the North.  The weather didn’t have the extreme impact on the North, but as in the South packers didn’t have much of an appetite to take on inventory.   Dressed trade continued to be in the low $180’s on most cattle.

With warmer temperatures trade and cattle harvest should get back to a more normal number this week.  Over the next few weeks, the April board and cash should begin to converge.  How this will happen is yet unknown, however, odds are good for producers to push cash higher and help narrow the gap.

Brad Hulett is Director, Customer Development & Regional Manager, Kansas at Consolidated Beef Producers , Inc.