Cattle Outlook: Beef price at record in 4th consecutive month

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USDA's February Cattle on Feed report said the number of cattle on feed at the start of the month was down 2.8% compared to February 2013. The trade expected that number to be down 4.0%. Placements into feed yards in January were up 8.6%. The trade predicted up 2.7%. USDA said marketings were down 5.5%. December steer and heifer slaughter was down 5.2%.

The average retail price of all fresh beef in January was record high for the fourth consecutive month. Beef in grocery stores averaged $5.044 per pound in January, up 0.7 cents from the record set in December and up 13.2 cents from a year ago. The average retail price of choice beef in grocery stores in January was $5.346 per pound.

The 5 area average live price for slaughter steers was $141.80/cwt in January. That was up $9.60/cwt from the record set in December and up $17.10/cwt from January 2013.

Cattle prices increased faster than retail prices during January causing the margins for the middlemen between farm and consumer to decline by 20.3 cents from December.

There were 429.3 million pounds of beef in cold storage at the end of January. This was down 2.3% from the month before and down 11.4% from a year ago.

Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $142.00/cwt, up 1 cent from a week ago and up $19.24 from a year ago. Steer sales on a dressed basis averaged $230.00/cwt this week, up $7.00 from a week ago and up $34.42 from year ago. Volume was very light.

This morning, the boxed beef cutout value for choice carcasses was $214.78/cwt, up $7.55 from the previous Friday and up $32.04 from a year ago. The select carcass cutout is $211.82/cwt, up $4.52 for the week and up $31.29 from last year.

This week's cattle slaughter totaled 539,000 head, unchanged from the previous week and down 5.1% from the corresponding week last year. The average steer dressed weight for the week ending on February 8 was 871 pounds, down 3 pounds from the week before, but up 3 pounds from a year earlier.

Feeder cattle prices at this week's Oklahoma City auction were steady to $5 higher in good volume. This week's prices for medium and large frame #1 steers by weight were: 400-450# $222-$244, 450-500# $198-$230, 500-550# $191-$221, 550-600# $191-$208, 600-650# $172.50-$199, 650-700# $173-$186, 700-750# $168-$175.50, 750-800# $164.50-$173.10, 800-900# $152.25-$171, and 900-1000# $145-$158.50/cwt.

The February live cattle futures contract closed at $144.55/cwt today, up $1.95 from last week's close. April fed cattle settled at $141.45, up 35 cents for the week. June settled at $132.72/cwt, up 42 cents.

The March feeder cattle futures contract ended the week at $170.70/cwt, up 23 cents for the week. May feeders closed at $171.20/cwt, down 15 cents from the previous Friday.

Source: Ron Plain and Scott Brown



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