Compared to last week, yearling feeder cattle sold $2-$5 higher while calves traded $5-$10 higher with the full advance once again on lightweight steers under 500 lbs.
Each week, yearling price levels seem to have topped-out only to appear fairly reasonable by the following week’s trading. Independent farmer feeders are fully engaged in the purchasing frenzy as yearling demand continues to be best in the high corn production areas, while Nebraska Sandhill supplies were much lighter than normal this year.
At the salebarn in Fairview, Illinois (where seed-corn caps outnumber cowboy hats by at least 10 to 1) a fancy load of 752 lb steers brought $167.50 on local demand while the Wednesday sale at the ol’ St. Joseph MO Stockyards saw a three load string of top quality 705 lb heifers sell for $159.50 bound for a Nebraska feedlot. The CME Feeder Cattle Index, which is the cash settlement price for Feeder Cattle contracts (based on a 750 lb steer) reached $152.36 this week which is the highest level since June of 2012.
Calf sales have been just as impressive, mostly in response to unseasonably wet weather throughout the Southern Plains with additional flash flooding seen in parts of Kansas and Oklahoma this week. The OKC-West El Reno, OK Livestock Market sold a part load of thin-fleshed 451 lb steers on Wednesday at $206.
Backgrounders are digging just as hard as cattle feeders to replace their headcounts; but unlike the feedlots, cattle growers have experienced handsome profits on recent sales to replenish their investment equity.
Finally, black ink seems to be on the way for feedlot closeouts. Cheaper feedstuffs and an improving fed cattle market promise some relief for cattle feeders with feedlots still rejecting steady bids late Friday in Southern regions, while limited sales were quoted in Nebraska and Iowa from $199-$200 dressed to regional packers.
Rainfall has not been nearly as plentiful across the Corn Belt and the upper Midwest this summer but mild temperatures have kept crops and pastures from burning up. Now that harvest yields are the only unanswered variable to this year’s crop, analysts have moved to early frost fears to create grain market volatility. Along with grass regrowth, wheat pasture grazing should be good this fall which will keep a fire stoked under the calf market.
Yearling prices are bound to be near their peak, unless a fat cattle rally unleashes more market potential. This week’s reported auction volume included 56 percent over 600 lbs and 40 percent heifers.