For the first time in a month, fed cattle posted a weekly advance – meager as it was. Cash trades were $1 per hundredweight higher at $114 last week with cattle on a dressed basis selling at $180. Feedyards will begin this week asking at least $3 more than last week with strong ideas the summer lows have been established. Fed cattle supplies will decline going forward, and cattle feeders will be anxious to begin shrinking the huge per head losses they have experienced this summer.
Choice boxed beef values closed Friday at $176.94, a decline of $3.63 per hundredweight from the previous week. Select boxed beef prices were quoted at $170.03, down $0.82 from the previous Friday. The Choice-Select spread stood at $6.91 per hundredweight.
Feeder cattle traded steady to $3 lower on the week with calves uneven from $3 lower to $3 higher and most gains reported in the Southeast. Prices for feeder cattle and calves remain hostage to rising corn prices and deteriorating pasture conditions. Buyer demand was called light to moderate.
The damage of this year’s drought can’t be overstated for America’s ranching industry. More than 50 percent of the nation’s cow herd is located in states where pastures are in poor to very poor condition. The industry entered the year with the smallest cow herd since the Eisenhower Administration began, and many think next year’s herd will be the smallest since 1942, or shortly after the U.S. entered World War II. The July 1 cattle inventory reported by USDA totaled 97.8 million head, down 2 percent and the lowest July inventory since the series began in 1973.
Corn prices took a breather before bouncing higher again last week. The latest crop report dropped the condition of the crop rated good to excellent from 31 to 26 percent. That’s the second worst crop rating bowing only to the 17 percent rated good to excellent reported in 1988.
Last week’s auction receipts totaled 119,400, compared to 156,900 last week and 168,100 last year. Direct sales of stocker and feeder cattle totaled 70,500 with video/Internet sales at 96,200. The weekly total was 286,100, compared to 312,500 last year.
Slaughter cows were steady to $4 per hundredweight higher and slaughter bulls were called unevenly steady. USDA's Cutter cow carcass cut-out value Friday morning was $164.33, down $2.72 from the previous Friday. Omaha cash corn was down 34 cents compared to the previous week at $7.78 per bushel.