Compared to last week, yearlings traded very uneven, in most cases weighing over 700 lbs trading from steady to 5.00 lower. Calves traded in a wide range through the Southwest and Southeast selling steady to 5.00 higher and through the Midwest and Northern Plains unevenly steady to spots 5.00 lower.
Large strings of wheat grazing yearling cattle have had the opportunity over the last couple of weeks to make their way to the auctions, as several large volume salebarns through the South Central Plains have had headcounts of over 10,000 the past couple of weeks. Purchasing of grazing cattle is at its peak and most cattle growers want to turn-out a stocker big enough to be an 800 lb yearling feeder by late summer or early fall. Demand remains very good for popular weight of steer calves weighing from 450-650 lbs. Most steer calves under 550 lbs are selling near or over 3.00/lb level, especially those under 500 lbs. Their heifer mates are not quite as popular trading mostly 30.00-40.00 back and in many cases 50.00 back. Most top quality 600 lb steers with a longtime weaned and lightly fleshed condition that is suitable for grass are yielding prices well north of 2.50/lb near the major grazing regions. Buyers want these cattle to gain their heads off and press down hard on the scales late summer when they take their cattle off grass; in hopes that prices for these yearlings will escalate even farther into summer.
Caution in the Cattle Futures seems to be persistent with ample supplies of pork and poultry found everywhere. Ag commodities are all under pressure as large supplies of corn, wheat, and soybeans are keeping pressure on all ag commodities. CME cattle futures made a very impressive rally on Wednesday exploding with sharp triple-digit gains. Hopefully this surge to the upside in the cattle complex will also push the cash cattle trade higher.
The increase in seasonal demand with Easter just around the corner, graduations, Mother’s Day and then Memorial Weekend not far behind as best beef demand resides in the second quarter of the year. The arrival of spring and its warmer days, greener pastures, and the annual lighting of the backyard grill will have the grilling season well under way. The high US dollar makes prospects for export sales a little tougher, but the dollar weakened early to mid-week as the Federal Reserve pointed to slow economy growth and with the dollar’s strength weighing on the economy higher interest rates is looking farther off. This could be good news for meat sales abroad if any further weakening occurs in the dollar.
Less supply in recent times as the weekly FI cattle slaughter was estimated at 518,000, roughly 90,000 head lower when compared to the previous 5-year average of around 608K for this particular week in the year. Also, this weekly slaughter estimate is the lowest since 1980 for this corresponding week. Friday afternoon's Cattle on Feed Report had March 1 inventory at 99 percent; placements at 92 percent; marketings came in at 98 percent. Inventory was very close to expected; marketings were slightly higher; and placements slightly smaller than expected. Auction volume included 63 percent over 600 lbs and 40 percent heifers.