Compared to last week, feeder cattle and calves sold unevenly steady to $3 lower. The full decline was noted in the Northern Plains where prices have been the highest, while Kansas feeders continued as much as $3-$4 higher.
Price levels are still perched at or near record-highs with no buying segment ready to step forward and push the market any higher, but crowds anxiously waiting for the chance to cheapen recent purchases. Many market watchers feel that prices are top-heavy (perhaps an understatement) but demand remains good for all classes with buyers very concerned about the size of available offerings over the next several months.
Midwestern Farmer-feeders still fought over Nebraska Sandhill feeders this week in Bassett where near 400 head of fancy 6 weight steers averaged 649 lbs at $207.17. This happened on a market that was a much as $10 lower than two weeks ago on the bulk of sales. Every rocket eventually reaches its optimum elevation and then it either levels out or explodes. The former is most likely with fundamental indicators fully supportive of the ongoing rally in cattle and beef demand.
Friday’s much anticipated USDA cattle inventory report lent additional support to the market with total cattle and calves as of January 1st at 87.7 million head, nearly 2 percent less than last year’s 89.3 and the smallest since 1951.
The report also quoted calves weighing under 500 lbs at 4 percent fewer than last year, with beef replacement heifers up 2 percent. The only class of beef cattle that did not reach all-time record highs during January was slaughter cows, but this past week packers pushed many cows well over $1/lb with competition from local investors looking to either harvest another calf from the old girl or put some cheap weight on her.
Fed cattle trading never developed this past week with the last established market at more than an $8 premium to February CME Live Cattle futures. The industry depends on the board and cash coming together at maturation of the contract.
Meanwhile, boxed beef cut-out values for the week were about $6 lower than last week. Packers are struggling to fill needs in this cattle seller’s market; while cattle producers, backgrounders, and feeders can be seen bobbing their heads to “Let the Good Times Roll”. This week’s reported auction volume included 60 percent over 600 lbs and 40 percent heifers.