Compared to last week, feeder and stocker cattle markets continue to show considerable strength this week. All classes of feeder cattle and calves sold firm to 5.00 higher with instances up to 10.00 higher on calves and yearlings from mid-week on. Price levels continue to soar for good yearlings especially those selling with good weighing conditions and strings of fancy calves.
The calf market this time of the year can be tough on the un-weaned fleshy calves with the warm days and cool nights that are typical for this time of year. Buyers at this time of the year are in search for calves that spend more time eating than bawling and staying healthy. But, times are a little different this year as buyers and farmer feeders are aggressive to own feeders or risk leaving the barn with an empty trailer. There is simply a large desire to purchase all levels of feeder cattle than current availability at many auctions.
The stars and planets seem to be lining up for this feeder market as very good demand, fewer supplies than in the past and with corn prices at their lowest levels in five years. Corn prices have fallen to a five year low with many areas throughout the Corn Belt seeing corn prices here at harvest time hovering around the 2.50-2.70/bu price levels at their local elevators. Corn farmers are ready to harvest the largest corn crop ever in the U.S. with September corn stocks at 1,236 bb, 50 mb more than expected and with the record harvest looks to add to the huge stock pile. This has many Corn Belt farmer feeders ready to purchase feeder cattle and “walk off their corn” than sell it for well less than 3.00 per bushel. Big crops usually get bigger, corn yields will be no exception.
On Wednesday in Bassett, NE sold 425 head of yearling steers weighing from 900-945 lbs with an average weight of 928 lbs and average price of 237.11. The “Bull” returned to the Feeder Cattle and Live Cattle futures this week and ready to eat as on Wednesday the front six months of the feeder cattle contracts closed limit higher with live cattle contracts making sharp gains and moving to all-time highs. Cattle futures have had big ups and big downs becoming very erratic at times and each day can close hard one way or the other. The entire cattle complex could be due for a correction as we have seen with these huge swings up and down as it remains very volatile.
A limit up close on Live Cattle futures last Friday wasn’t enough for packers who didn’t want to give in as last week’s 5-Area negotiated cash trade was the lowest level since Mandatory Price Reporting started in 2001 at 30,989 head. Feedlot trade remains inactive at this time and has been limited the last two weeks. This week’s auction volume included 46 percent over 600 lbs and 38 percent heifers.