The good news is that there is some good news in cattle and beef markets this last week. Choice boxed beef prices improved $3+/cwt. this week and were nearly matched dollar for dollar with stronger fed cattle prices. Current feedlot supplies of ready cattle are fairly tight at this time despite the fact that the last Cattle on Feed report showed that feedlot inventories were slightly higher than last year for October 1. Feedlot inventories have increased the past three months due to reduced marketings and larger placements. The marketings rate, as a percent of total feedlot inventories has remained close year ago and average levels and does not suggest any significant backup in feedlot cattle. Larger placements implies that more cattle will be available in the coming months. However, the weight breakdown of placements makes it very premature to suggest inevitable problems down the road. And, of course, there is also the potential for winter weather to impact fed cattle markets for better or worse.

Feeder cattle prices were steady to higher this week and a few days of sunshine jump-started stocker demand with higher prices despite last week’s large run of feeder cattle. Limited improvement in March Feeder Cattle futures means that a decent stocker margin still remains and additional demand for stocker cattle is expected to keep calf prices steady to slightly higher for the next month. Not all the news is good as delays in corn harvest have pushed corn futures higher. However, the fact is that the corn is made and while harvest problems may mean additional harvest of high moisture corn much of this supply may be available to feedlots at effective prices lower than suggested by corn futures.

Source: Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist