Cattle Market Reports and Analysis
COVID-19 has temporarily placed a restriction on the number of cattle that can be harvested in a given week. That scenario is usually a recipe for lower prices, but this week’s extremely light fed trade was steady.
Lower grain prices last week helped boost prices for feeder cattle and calves at most auctions across the country. AMS reporters expect grain prices will continue to be a major factor in cattle prices going forward.
USDA’s annual Cattle Inventory report released Friday estimated the total U.S. herd on Jan. 1, 2021, at 93.6 million head, about 200,000 head fewer than in 2020.
Numerous factors are in place that will shape cattle markets for at least the first few months of 2021. The COVID pandemic will continue to limit food service and restaurant demand for beef.
Flow of cattle through feedlots should begin to show more consistent tightening in 2021. The beef cowherd was at a peak in January 2019 and led to a 2019 calf crop that was down 0.7 percent from the 2018 peak calf crop.
Placements in feedlots during November totaled 1.91 million head, 9 percent below 2019. Net placements were 1.85 million head.
President Donald Trump told reporters Wednesday he has asked the Justice Department to look into allegations that U.S. meat packers broke antitrust law.
Here are forecasts for production, imports, exports and per capita consumption of beef, pork and broiler meat in 2021.
A large winter storm is advancing across the central U.S. bringing cold temperatures and some much-needed moisture. Feedlots continued to build inventory during September leading to a record inventory for Oct. 1.
A fall rally in cash fed cattle markets has added $5 to $6 per cwt. over the past three weeks. Feeder cattle remain in moderate demand, but drought conditions across much of the Great Plains is affecting cattle markets.
This first full-week following the Memorial Day holiday delivers signals cattle markets may see a second wave of downward pressure, the after-shocks of the COVID-19 earthquake.
Early week fed cattle sales were steady at $95 to $100 per cwt., and $150 dressed. Friday, however, saw one major jump in and buy a few thousand cattle at $105, $5 higher than last week.
Unprecedented volatility in fed cattle markets during March produced a strong increase in negotiated cash sales from feedlots to packers the final two weeks of the month.
During a Facebook Live address to cattlemen Monday night, R-CALF CEO Bill Bullard outlined four actions his group proposes to “restore balance to our dysfunctional cattle markets.”
The current cattle market situation creates significant disparities between the current supply and demand situation and expectations for coming supply and demand conditions.
Panic meat buying emptied shelves and drove the Choice beef cutouts nearly $48 per cwt. higher. Cash fed cattle were higher, but not at a proportionate level.
Last week’s early winter storm exposed cattle to cold, wet conditions, but also brought much-needed moisture to the nation’s wheat belt reviving prospects for winter grazing.
Both CME cattle futures and cash prices were lower for the second consecutive week. USDA’s cattle on feed report found a record October 1 inventory as September placements were called 6% higher.
Cattle feeders found softer prices and weaker packer demand as last week progressed, driven in part by declines in CME futures prices.
There are many dynamics in cattle slaughter markets in the fourth quarter that will determine total slaughter for the year, but an early analysis suggests a 2.5% decline.
Packers were fairly aggressive in their drive to increase their inventory. Cash traded mostly on Thursday, but packers took on additional cattle Friday at steady money.
Markets will no doubt evolve this fall and producers must continue to evaluate winter grazing potential under dynamic market conditions and profit potential may vary widely.
Cattle prices rallied for the seventh consecutive week, adding $12 per cwt. over that span. Cattle on feed numbers were up 2% Aug. 1, with July placements up 11%.
USDA’s release o Friday of Cattle on Feed and Cattle Inventory report data suggests backlog is decreasing in feedyards and beef cow numbers are tightening across cattle country.
Steers and heifers sold higher at auctions on the Northern Plains, with feeder cattle trading uneven at auctions in the Southeast and South Central regions.
Slaughter numbers approached year-ago levels for the week as beef packers are operating at near-capacity and wholesale beef prices continue lower.
Boxed beef cutout values continue to perform like the early days of Bitcoin trading, with Choice advancing $84 per cwt. since last Friday.
Cattle feeders experienced a week of light participation from packers as the impact of COVID-19 begins to hamper beef production facilities.
The unprecedented events surrounding the COVID-19 pandemic have led to a severe economic downturn and will impact livestock markets going forward.