Compared to last week, cattle immediately bound for confined feeding sold 2.00-5.00 lower with the full decline on weights over 800 lbs. Stocker cattle and calf markets were fairly uneven, depending on local demand and moisture conditions. However, Southeastern areas have had ample moisture and still the losers outweighed the gainers in most instances as western orders have yet to fully materialize.
Nationwide auction receipts were moderately heavy this week and larger than both last week and last year, although year to date receipts are still running roughly 17 percent behind 2012 and the 5 year average. Pressure continues on any class of cattle that requires grain as feedcosts have eliminated the chance for most pens to breakeven, but the demand for grazing cattle is starting to spark in certain areas.
The recent rains and snows coupled with warmer temperatures this past week would normally have stocker buyers inebriated. However, some pre-condition lots are muddy and the fear of needing any amount of supplemental feed (whether it be a commodity mix or just hay) to carry cattle until turnout dates become available is holding buyers back. Plus, there is literally no support for a current cash cattle position from the CME cattle futures as the Ouija Board continues to free-fall in the face of solid fundamentals.
Investment funds are hanging ten on the impressive stock market wave, leaving no one to take a long out-front cattle commodity position. Agriculture lenders have tightened and no longer want to risk another unprotected gamble on the future, unless maybe it’s to help set an all-time record cash rent market for prime corn ground. Southern regions have already began planting season and even though cattlemen may be heard grumbling every time another pasture is plowed-up or fence row is taken out, nobody will be cheering harder for a mammoth corn crop this year.
Feed shortages have plagued cattle production and tough decisions are being made, like the one by the Olsen Ranch to sell 1600 head of their one iron calves for the first time in three generations instead of grazing them until they are long yearlings and retaining ownership until finished. These top quality thin-fleshed black calves were sold last Saturday at the Ericson, NE Livestock Auction with five loads of 510 lb steers bringing 199.00 and another five loads of their bigger brothers averaging 605 lbs at 173.75. The best feeder demand this early spring is for the 6 weight stockers that need little or no warming-up for grass and will come off pasture as heavy feeders that can be topped off with new crop corn.
Fed cattle sold 1.00 lower at 127.00 and 2.00-3.00 lower dressed at 201.00 even though boxed beef cut-out levels perked this week and Select boxes actually broke an all-time record high at 196.00 on Wednesday. Wholesale beef movement has been too light for the inflated prices to be significant to the market and the beef business badly needs the northeastern seaboard to get a break in the late winter weather. This week’s reported auction volume included 62 percent over 600 lbs and 44 percent heifers.