The USDA Cold Storage report released last Friday showed that total stocks of beef, pork, chicken and turkey in U.S. freezers at the end of July were 292 million pounds less than July 2013, a decrease of 12.7 percent. This is the fifth consecutive month where total meat stocks were at least 12 percent below the year ago level. Beef stocks were down the most of these four meats in both absolute and percentage terms, trailing last year by 20.8 percent.

Farm income projections released this week by USDA point to a 15 percent increase in cash receipts for cattle and calves in 2014. If realized, the projected level of $79.5 billion would be the third time in the last five years that cash receipts to the cattle industry increased by at least 15 percent.

USDA released the preliminary August steer and heifer to corn feed ratio in yesterday's Ag Prices report. It now stands at 43.5, the highest level in 8 years. This ratio has increased for three months in a row and is now more than 2.4 times greater than the July 2013 level of 17.8.

Choice boxed beef cutout values were down every day this week and have now fallen for 16 consecutive days. The cutout value for choice carcasses this morning was $245.99/cwt, down $4.21 from last Friday, but $50.31 higher than a year ago. The select cutout declined to $234.78/cwt on today's morning report, down $5.29 for the week, but still $52.30 higher than a year earlier. The choice-select spread this morning of $11.21/cwt trails only yesterday as the highest reading since early May.

Through Thursday, the 5-area average price for slaughter steers was up this week despite the drop in the cutout. Steers sold on a live weight basis were $154.56/cwt, up $1.74 from last week's average, and up $31.04 compared to a year ago. The 5 area average dressed price for steers gained $1.13 on the week to $242.98/cwt.

Cattle slaughter totaled 584 thousand head this week, down 1.0% from the week before and 7.7% fewer than the same week last year. The average dressed weight for steers slaughtered the week ending August 16 was 879 pounds, up 4 pounds from the week before and 15 pounds heavier than the same week last year.

Feeder steers and heifers were steady to a dollar lower at this week's Oklahoma City auction. This week's prices for medium and large frame #1 steers by weight group were: 400-450# $303-$324, 450-500# $273-$294, 500-550# $264-$278, 550-600# $250-$268, 600-650# $230-$246, 650-700# $218.50-$228.50, 700-750# $209-$227.75, 750-800# $209-$222.25, 800-900# $194-$217, and 900-1000# $194-$207.50/cwt.

Cattle futures posted solid gains this week. The August live cattle futures contract closed at $155.90/cwt today, up $4.05 on the week. October fed cattle settled at $151.42/cwt, up $4.42 for the week. The December contract finished the week at $153.95/cwt. The September feeder cattle contract advanced $7.75 this week to end at $218.65/cwt. October feeders closed at $216.72/cwt.