Ron Plain: Cattle Outlook

Ron Plain and Scott Brown
Ag Economics, MU
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USDA's April Cattle on Feed report said placements were up 4.6% in March and marketings were up 7.1%. That left the April 1 cattle on feed inventory at 100.5% of a year ago.

The average retail price of choice beef was $6.223 per pound in March. That was up 23.7 cents from the month before, but down 8.6 cents from a year ago. March grocery store prices for choice beef were the highest since October. The average price for all fresh beef at retail was $5.859 per pound during March.

The 5 area average price of slaughter steers was $136.40/cwt in March. That was up $1.40 from the month before, but down $26.00 from March 2015.

The final livestock slaughter numbers for 2015 were released this week. Commercial cattle slaughter totaled 28,751,600 head, down 4.7% from the year before and the lowest yearly total since 1963. Commercial beef production was 23.6977 billion pounds. That was 2.3% less than the year before and the lowest since 1993. The average dressed weight for steers in 2015 was 892 pounds, up 20 pounds from the year before.

Beef cutout values are lower this week. This morning the choice boxed beef cutout value was $220.50/cwt, down $4.53 from the previous Friday and down $38.28 from a year ago. The select carcass cutout this morning was $211.56/cwt, down $4.74 from last week and down $37.72 from a year ago.

Fed cattle prices were sharply lower this week in moderate volume. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $125.58/cwt, down $8.39 from last week's average and down $33.33 from a year ago. The 5-area dressed steer price averaged $205.46/cwt, down $8.87 from the week before and down $46.68 from a year ago.

This week's cattle slaughter totaled 587,000 head, up 7.1% from last week and also up 7.10% from a year ago.

The average steer dressed weight for the week ending on April 9 was 880 pounds, down 4 pounds from the week before, but up 9 pounds from a year ago. This was the 95th consecutive week with steer weights above the year-ago level.

Prices on feeder cattle this week at the Oklahoma City Stockyards were $5 to $12 lower compared to last week. Prices for medium and large frame #1 steers by weight group were: 450-500# $187-$190, 500-550# $178-$186.50, 550-600# $168-$173, 600-650# $146.50-$168, 650-700# $152-$161, 700-750# $149.50-$156, 750-800# $142-$147, 800-900# $130-$145.25 and 900-1000# $129.50-$137/cwt.

Today, the April live cattle futures contract settled at $124.72/cwt, down $6.75 for the week. June fed cattle settled at $114.65/cwt, down $7.52 from the previous Friday. The August contract ended the week at $111.55/cwt, down $6.47 from the previous Friday. April feeder cattle ended the week at $147.95/cwt, down $7.12 from a week earlier. May futures lost $8.10 this week to close at $142.45/cwt.

Source: AGEBB