Fed Cattle
Economics and the impact on weights – both longer-term and decisions based on short term factors will play an important part in determining beef production in 2024.
A year ago feeders were concerned about weathered cattle and tough pen conditions and how at times it would be the motivation for sellers to take the market. It’s eerie how not much has changed in that sense.
Cash fed cattle prices traded at higher prices the first week of the New Year despite a significant decline for wholesale beef prices.
The beef market is set to rapidly adjust to changes in consumer buying habits. This removes demand pressure from ribs and tenderloins, realigning the contribution of those cuts to a smaller percentage of carcass value.
The final week of 2023 found at least three bidders in the market in multiple regions.
Feedyards saw higher cash cattle bids for the second consecutive week as the market closed the year on an upswing. Futures prices finished the week lower.
LRP insurance is straightforward, versatile, and makes risk management readily accessible to producers. And that’s more important than ever; record prices translate to heightened equity risk.
USDA’s December Cattle on Feed report totaled over 12 million head for the first time since May of 2022.
The shift to tighter fed cattle supplies and smaller slaughter head counts pushed year to date (YTD) fed cattle prices up 22% on average for the year.
Increased packer margins in recent weeks has encouraged a quicker chain speed. That speed likely will not be supported through the end of the year with two Holiday shortened weeks.
Futures markets posted solid gains for the week, but cattle feeders continued to lose marketing leverage as cash prices declined a sixth consecutive week.
Cattle feeding margins fell deeper into the red while packer losses doubled from the prior week. Pork producer margins have now printed red every week for the past year.
Another round of falling futures produced another round of lower cash bids. Cattle feeders now offer their smallest showlists of the year.
Four grants have been awarded by ICASA totaling roughly $1.15 million to identify why liver abscesses occur and develop diagnostic tools to enable informed decision-making to treat the condition.
Cash cattle and wholesale beef prices continued their fourth quarter retreat and record heavy carcass weights suggest cattle feeders have lost marketing leverage.
Cattle feeders and beef packers both printed closeouts with red ink last week, slight advantage packers. Pork producers also operated underwater but pork packers saw improving margins.
Few things in cattle market trends are entirely predictable but the fact that carcass weights peak in November is as close to a sure bet as one could identify.
Some blame the recent rout in the futures markets on LRP (Livestock Revenue Protection), a claim that is wholly unsubstantiated. A look at the data confirms LRP blame really is a smoke monster.
A summary of 15 years shows how feedlot production continues to develop and reflect changes in cattle genetics and feeding technology and management.
Declining cattle futures prices continue to pressure cash prices. The cheaper inventories are working to pad the packer’s pocket as evidenced by a few plants operating on Saturdays.
Market-ready cattle prices have rolled back $10 per cwt. since the end of October and average carcass weights have increased to all-time highs, a sign feedlots are not as current as previously expected.
Rib and tenderloins are pricing near their annual highs, but a look at annual price trends across the beef carcass shows increasing contributions to CAB premiums from both ends of the carcass.
Light cattle sales volumes were recorded in all regions during Thanksgiving week with cash prices generally $1 lower than the previous week, marking the fourth consecutive week with lower cash prices.
Cattle feeding margins declined nearly $100 per head last week with lower cash bids and rising costs. Pork producer margins remain mired in red ink.
A combination of factors has contributed to increasing feedlot placements the past two months, including drought and increasing imports. But biggest factor is likely that producers are taking advantage of strong prices.
Friday’s COF placement numbers provided a friendly lean to a market that has suffered consecutive weeks of falling futures and lower cash bids. Sellers hope to leverage the short week ahead with higher asking prices.
Prices for market-ready cattle have tumbled $7 to $8 per cwt. since the beginning of the month even as supplies remain relatively tight. Volatility continues in the futures market.
Beef exports continue to face significant headwinds in 2023, and September’s export volume was down 15% and the lowest of the year so far.
Cash cattle prices decline 3% for the week as December Live Cattle futures hit a five-month low and nearby feeder futures post seven-month low.
Using cutting-edge artificial intelligence and sensor technologies, Oklahoma State University researchers have embarked on a groundbreaking project aimed at studying stress in cattle.