Gearing up for summer grazing

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The commentary in this past Friday’s National Stocker and Cattle Summary report by Corbitt Wall, Greg Harrison, Baldemar Ortiz, and Kinley Hartman alluded to the declining availability of cattle. They note that “Auction managers have exhausted their “little black books” and most don’t know where they’re going to find cattle to hold sales each week until mid-summer yearlings start to show up.”

At first glance these comments might appear convoluted given that, using data from this report through the week ended April 18, accumulated weekly auction receipts are 3 percent higher than the same time one year ago and the total of all accumulated receipts are 5 percent above year ago levels. Granted, as one would expect given the declining beef herd numbers, the accumulated totals of auctions, direct sales, and video/internet sales are about 7 percent lower than the average from 2009 to 2013.

However, these data are another indicator of the market surge that we seem to be waving good-bye to at the moment. The strong prices in the first quarter of the year encouraged cow-calf producers to market their cattle earlier than normal and thereby “inflated” the current sales receipts count. This is supported by the larger than expected placements in both January and February reported in the past two Cattle on Feed reports.

The report’s authors bring this up when they note “auction receipts in March likely included a much larger percentage of available spring supplies.”

This sentiment is glaringly true based on the data for cattle sold weighing less than 600 pounds. For these cattle, total receipts (including auction, direct, and video/internet) were about 16 percent above 2013 totals during the month of March. This most likely will lead to fewer cattle available in the coming weeks as stockers and backgrounders search for cattle to fill their pastures while auction managers wring every last resource out of their “little black books.”

Also of note in the data from report mentioned above:

  • Feeder cattle receipts for all types of sales (those weighing more than 600 pounds) were 6 percent lower than one year ago during March.
  • Accumulated heifer receipts, through the week ended April 18, are about even with 2013 and 13 percent lower than the average from 2009 to 2013.
  • Accumulated steer receipts are 9 percent higher than 2013 and 3 percent lower than the five-year average.

The Markets

Live and dressed cattle prices declined with steer prices dropping $2.23 and $5.08, respectively.

The weakness in the cash markets appears to be a result of lower wholesale 2 boxed beef as Choice boxes marked their fourth straight week of lower prices.

On the bright side, both Choice and Select price have been moving higher since last Wednesday in hopeful preparation for the delayed start to this year’s grilling season and the upcoming holiday grilling weekends in May.

Calf prices in the Southeast were about $2 per hundredweight higher last week compared to the previous week, while feeder prices were moderately lower across all regions. Feedstuff prices were mostly even when compared to the previous week.

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