Demand for grazing cattle weakens as the days shorten, temperatures become cooler and the lack of moisture persists. Wheat pastures on the Southern Plains have shown decline for weeks, and cattlemen are now seeking to reduce inventories and readjust business strategies.
Calf markets saw steady to $3 lower bids last week, with an exception noted along the Interstate-70 corridor from eastern Colorado to Missouri where calf prices were steady to $3 higher. Market reporters continue to note the limited supplies of “true” yearling feeders and weaned calves over 650 pounds, which found a market with a higher undertone. Fleshier yearling cattle from growing yards on the Southern Plains found softer prices.
USDA Market News reporter Corbitt Wall identified the sources of stronger demand for calves. “The best demand was noted from Midwestern and Northern Plains backgrounders who are now fully done with a disappointing harvest and looking for additional off-season profit opportunities.”
Wall also said last week’s cold front in northern regions “boosted calf interest with widespread hard-freezes which eliminated most flies and many airborne viruses plaguing new calf purchases this fall. Each week a larger percentage of the northern quality calves have now been weaned for at least 30 days and starting to reach the desired timeframe which is 45-60 days away from momma.”
Demand in the Southern Plains, however, has grown progressively lighter for stocker cattle and calves. Wheat pasture in the Texas-Oklahoma region was described as “spoiled” due to the lack of moisture and the looming winter season. Wall says cattlemen in the region are now looking to sell those pre-conditioned stockers as the forage supplies dwindle.
Last week’s auction receipts totaled 299,400, compared to 291,500 the previous week and 327,500 last year. Direct sales of stocker and feeder cattle totaled 36,600 with video/Internet sales at 2,700. The weekly total was 338,700, compared to 364,600 last year.
Cash fed cattle traded steady to $1 higher last week at $125 to $126 per hundredweight. Dressed sales in Nebraska were called $2 higher at $196 per hundredweight, and a few at $197. Supplies of market-ready cattle are increasing seasonally, and will add pressure to prices through the end of the year.
Boxed beef prices gained modestly through the week. Choice boxed beef traded Friday at $193.02, an increase of $1.15 per hundredweight from the previous Friday. Select boxed beef declined $0.48 for the week to $173.08. The Choice-Select spread finished the week at $19.94 per hundredweight, an increase of $1.63 from the previous week.
Slaughter cows and bulls sold mostly steady. USDA's Cutter cow carcass cut-out value Friday morning was $160.17, up 21 cents from the previous Friday. Omaha cash corn was 19 cents per bushel lower for the week at $7.43 per bushel.
Friday’s cattle on feed report held no surprises for the trade. Total inventories were down 5 percent from last year, and placements were down 13 percent. Marketings were 3 percent higher than last year.