Cattle Outlook: Boxed beef prices sliding lower

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Retail beef prices set new record highs in August for the second consecutive month. The average price of choice beef in grocery stores during August was $5.394 per pound. That was up 44.9 cents from August 2012 and up 3.7 cents from the record set the month before. The average price for all fresh beef was $4.968 per pound. That was up 26.8 cents from August 2012 and up 2.5 cents from the record set the month before.

The crop condition report for September 15 said 53% of corn acres were in good or excellent condition. That was down 1 percentage point from the month before, but up 29 points from a year ago. The pasture condition report rated 37% of U.S. pasture acres as poor or very poor. That was 1 percentage point more than the week before, but 19 points less than a year ago.

Fed cattle prices were a bit lower this week with very light sales volume. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $122.70/cwt, down 30 cents from last week and down $2.59 from the same week last year. There were not enough steers sold on a dressed basis for a price quote.

Friday morning, the boxed beef cutout value for choice carcasses was $192.45/cwt, down 61 cents from the previous Friday and down $1.43 from a year ago. The select carcass cutout is at $176.11/cwt, down 21 cents for the week and down $8.08 from the same day last year. The choice-select spread, $16.34 today, is up for the eighth consecutive Friday.

This week's cattle slaughter totaled 633,000 head, up 3.6% from last week and up 1.1% from a year ago. The average steer dressed weight for the week ending on September 7 was 872 pounds, up 5 pounds from the week before and up 2 pounds from a year ago.

Oklahoma City feeder cattle auction prices this week were $3 to $5 higher for steers and steady to $1 higher for heifers with prices for medium and large frame #1 steers: 400-450# $191-$203, 450-500# $188.50-$192.50, 500-550# $163.50-$176.50, 550-600# $165-$168.75, 600-650# $150-$169, 650-700# $150-$171.25, 700-750# $156-$168, 750-800# $152-$160.50, 800-900# $140-$159, and 900-1000# $138-$145.50/cwt.

The October live cattle futures contract closed at $125.95/cwt today, up 70 cents from last week's close. December fed cattle settled at $129.75, up 60 cents for the week. February closed at at $131.52/cwt.

The September feeder cattle futures contract ended the week at $157.10/cwt, down 20 cents from the previous Friday. October feeders settled at $160.22, up 95 cents for the week. The November feeder cattle contract ended the week at $160.75/cwt.

Source: Ron Plain and Scott Brown



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