USDA Reports
Following a major stakeholder meeting, USDA is boosting survey sample sizes and moving data-focused offices out of D.C. to rebuild farmer trust and improve the accuracy of its agricultural reports.
As America’s beef cow herd hits a 75-year low, dairy farmers are stepping in with beef-on-dairy calves to help fill feedlots and keep the beef supply moving.
With the lack of rebuilding the strong cattle market could be extended another year.
USDA’s annual report reveals the smallest total herd since 1951, with beef cow numbers falling to 27.6 million despite a slight uptick in replacement heifers.
Brad Kooima with Kooima Kooima Varilek says he was concerned the trade might view a slightly bearish Cattle on Feed report placement number as a reason to sell but the market was more focused on the higher cash trade Friday.
Brad Kooima with Kooima Kooima Varilek says strong cash has been supportive of the cattle futures and he expects a higher week in the fed market again this week. Grains are still digesting USDA’s bearish reports.
Live and feeder cattle futures were lower early Friday but Scott Varilek of Kooima Kooima Varilek says it didn’t take long for the markets to firm up supported by the cash market.
Rich Nelson with Allendale, Inc. says there is a general lack of news for the grain markets so some of the pressure is coming from end of the quarter and end of the year positioning by traders.
Live and feeder cattle futures made new highs for the move Monday morning after a strong close Friday and higher weekly closes. However, the big catalyst is the bullish USDA Cattle on Feed Report data according to Rich Nelson of Allendale, Inc.
Details are minimal so it’s not clear how there will be enough staff to provide the Milk Production, Crop Production, Cattle on Feed and WASDE reports with many still furloughed.
Brad Kooima of Kooima Kooima Varilek says live and feeder cattle futures are sharply higher on Monday as news came late Sunday that New World Screwworm (NWS) had been detected 70 miles from the U.S. Mexican border. in an 8-month-old calf from a transported herd.
Scott Varilek with Kooima Kooima Varilek, says the last time placements and markets were this low was in 2015, which may be signaling heifer retention is starting to take place.
Joe Kooima of Kooima Kooima Varilek says live and feeder cattle futures are higher early Monday but after a second week of lower weekly closes, he’s not sure if the market can retest the highs.
Scott Varilek with Kooima Kooima Varilek says live and feeder cattle futures are higher again on Friday morning with the third day of recovery after Tuesday’s melt down. They need to close above Thursday’s highs to have a shot at retesting the record highs.
Brad Kooima, Kooima Kooima Varilek, says the uptrend line on the cattle charts is also starting to be violated but that isn’t the only thing he’s watching for a signal of a bigger correction.
Brad Kooima of Kooima Kooima Varilek says live and feeder cattle futures gapped lower on the opening after a human case of New World screwworm (NWS) was announced over the weekend.
Scott Varilek with Kooima Kooima Varilek says the placements figure was slightly bearish and will likely mean a lower opening on Monday but the break is likely to be bought.
Scott Varilek with Kooima Kooima Varilek says both live and feeder cattle futures had a nice recovery and got within striking distance of the all-time highs set earlier in the week.
Derrell Peel, Oklahoma State University extension livestock marketing specialist, says USDA’s Cattle on Feed Report was friendly. The Cattle Inventory Report indicated confirms historically tight supplies will stay around for a while.
The department says it will relocate more than half of its Washington, D.C., staff to five hubs around the country, as well as consolidate or eliminate regional offices.
Scott Varilek, Kooima Kooima Varilek, says cattle futures are holding together despite lower cash trade, while grains are finally seeing a bounce in reaction to a China deal on rare earths.
Cattle inventory was 1% below the same date a year ago and in line with pre-report expectations, while placements were friendly coming in below estimates.
Brad Kooima of Kooima Kooima Varilek says cattle futures are seeing some early weakness despite last week’s record cash and neutral USDA Cattle on Feed Report compared to expectations. Corn is down with wheat and mostly favorable weather.
Dr. Derrell Peel, Extension livestock marketing specialist with Oklahoma State University, says the on feed number has been below year ago levels the last four months.
Scott Varilek, Kooima Kooima Varilek, says the slightly higher placements than expectations in the USDA Cattle on Feed Report are not a concern to him. He thinks cash is ultimately king!
With native cattle numbers still under pressure, beef-on-dairy crossbreds are providing the industry with a critical supply of cattle.
USDA’s annual Cattle Inventory Report released Friday shows the U.S. total cattle inventory shrunk another 1% over the past year, with the number of beef cows also down 1%.