Feeder cattle prices have increased this fall; showing no signs of seasonal weakness. Prices have advanced the most on 450-550 pound stockers, the most popular stocker animals for winter wheat grazing. Oklahoma auction prices for Medium and Large, Number 1 steers, 450-500 pounds averaged above $300/cwt. for the first time ever the last week of October, pushing higher to $307.02 this past week. Prices for 500-550 pound steers averaged $296.62/cwt. last week and may push above $300/cwt. this week. Rain in early October that established wheat was followed by a month of dry and warm conditions that threatened wheat pasture development. However, widespread rain across Oklahoma the first week of November ensures wheat pasture for the remainder of the year and has augmented stocker demand in November.
Stocker values of gain calculated on current prices have eroded slightly from the very strong levels that have existed since late summer. This is due to the proportionately bigger advance on stocker prices compared to heavy feeders the past couple of weeks. However, values of gain remain strong…well over a dollar per pound…and offer opportunity for returns this winter, especially as wheat pasture has gotten cheaper this fall. Values of gain are stronger for heavier beginning weights, i.e. animals over 600 pounds, perhaps providing an opportunity for producers anticipating a shorter winter grazing period.
The first few Oklahoma Quality Beef Network (OQBN) sales have been held and data on two of these sales confirm that buyers are paying strong premiums for the assurance that goes with certified preconditioned calves. Premiums over non-preconditioned calves have averaged $25-$30/cwt. in these early sales, with prices roughly 9-10 percent over market average prices. Buyers recognize that the risk of unknown health and nutritional status of ordinary calves makes it worth paying a premium over record prices for more information about these stocker calves.
Cull cow prices have held relatively steady the past month, down from the August/September highs. Cull prices are holding near $115/cwt., well above the spring highs and have shown relatively little seasonal weakness this fall. Beef cow slaughter continues well below year ago levels, down over 20 percent year over year in September and October. Breeding females have traded in a wide price range this fall in Oklahoma with good quality bred heifers and cows trading from $2200 to over $3000 per head. Prices have increased some since September. In October and early November, good quality young cow-calf pairs have traded from $2500 to over $3300 per head. Older and lower quality bred cows and pairs have traded under $2000 per head, in some cases bringing no more than slaughter cow values. If forage conditions look good next spring, the price range for breeding females will likely narrow and strengthen from values this fall.