The October WASDE raised USDA's estimate of 2015 beef production by 245 million pounds and lowered their forecast of the 2015 average price for slaughter steers to $149.19/cwt. They are predicting 4.9% more beef in 2016 and an average price for fed cattle that is $2 to $13/cwt lower than this year.
U.S. beef imports were up 27.8% in August while beef exports were down 23.6% compared to August 2014. Most major foreign suppliers shipped more beef to the U.S. than in August 2014 and, except for South Korea, most major foreign buyers of U.S. beef purchased less this August than last. Beef imports equaled 16.2% of U.S. beef production while beef exports equaled 9.1% of production.
Domestic beef demand was up 0.4% in August, but export demand for U.S. beef was down 26.3% compared to a year ago. Domestic beef demand has been up for 19 consecutive months and export demand down for four consecutive months.
Year-over-year, live cattle imports were up 3.8% in August with an 18.6% decline in Canadian imports offsetting most of a 31.6% increase in cattle imports from Mexico. Thus far for 2015, cattle imports are down 3.3%.
This morning the choice boxed beef cutout value was $202.97/cwt, down $3.78 from the previous Friday. The select carcass cutout was $197.93/cwt down $5.45 from last week.
The plunge in fed cattle prices stopped this week. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $118.52/cwt, down 9 cents from last week's average and down $44.93 from a year ago. The 5 area average dressed price this week for steers was $190.00/cwt, up $2.49 for the week, but down $70.28 compared to the same week last year.
The average steer dressed weight for the week ending on September 26 was 920 pounds, down 3 pounds from the week before, up 27 pounds compared to the same week last year, and above the year-ago level for the 67th consecutive week. This week's decline in steer dressed weight follows four consecutive weeks of record heavy weights.
Cattle slaughter this week totaled 557,000 head, down 2.5% from the week before and down 1.2% from the same week last year.
Feeder cattle prices at Oklahoma City were $2 to $6 lower this week. Prices for medium and large frame #1 steers by weight group were: 400-450# $219-$227, 450-500# $200-$223, 500-550# $192-$206, 550-600# $180-$195, 600-650# $174-$193.50, 650-700# $173.50-$188.50, 700-750# $175-$187, 750-800# $174.50-$186, 800-900# $169.50-$181.25 and 900-1000#, $166-$169.25/cwt.
Cattle futures were higher this week. The October live cattle futures contract settled at $130.77/cwt today, up $7.70 for the week. December fed cattle settled at $137.32/cwt, up $5.95 from the previous week. October feeder cattle ended the week at $188.97/cwt, up $9.47 from a week earlier. November gained $10.35 this week and closed at $184.87/cwt.