CATTLE OUTLOOK – Ron Plain and Scott Brown
Ag Economics, MU February 19, 2016
USDA’s February Cattle on Feed reports said the number of cattle in
large feedlots on February 1 was down a tiny 0.04% compared to a year
ago. January placements of cattle into feedlots were down 0.6% and
January marketings were down 2.2%. The report should be neutral for
the market. The trade was expecting January placements to be down
0.7%, January marketings down 2.2%, and the February 1 inventory of
cattle on feed down 0.2% compared to a year ago.
The Bureau of Labor Statistics says the average January price of
choice beef at retail was $5.975 per pound. Grocery store prices
averaged 0.3 cents higher than in December, but were 35.8 cents lower
than in January 2015. The average retail price for all fresh beef was
$5.756 during January, the lowest since July 2104.
The 5 area average price for slaughter steers during January,
$134.50/cwt, was up $9.80 from the month before, but down $29.90
compared to 12 months earlier.
Fed cattle prices were mixed this week in light volume. Through
Thursday, the 5-area average price for slaughter steers sold on a live
weight basis was $130.00/cwt, down $1.70 from last week’s average and
down $30.03 from a year ago. Dressed steer prices averaged
$209.63/cwt. That is up $3.07 from the week before, but down $46.73
from a year ago.
This morning the choice boxed beef cutout value was $212.26/cwt, down
$4.41 from the previous Friday and down $27.86 from a year ago. The
select carcass cutout was $208.54/cwt, down $4.54 from last week and
down $28.32 from a year ago.
This week’s cattle slaughter totaled 521,000 head, down 4.2% from last
week and down 0.2% from a year ago.
The average steer dressed weight for the week ending on February 6 was
899 pounds, up 1 pound from the week before and up 15 pounds from a
year ago. This was the 86th consecutive week with steer weights above
the year-ago level.
Prices at the Oklahoma City Stockyards this week were steady to $3
higher on feeder steers and steady on calves compared to last week.
Prices for medium and large frame #1 steers by weight group were:
400-450# $210-$218, 450-500# $204-$209, 500-550# $185-$202, 550-600#
$168-$187, 600-650# $161.50-$177.50, 650-700# $157-$169.50, 700-750#
$146-$159, 750-800# $147-$156.50, 800-900# $140-$151.75 and 900-1000#
Cattle futures were higher this week. The February live cattle
futures contract settled at $135.37/cwt today, up $5.42 for the week.
April fed cattle settled at $133.95/cwt, up $4.83 from the previous
week. The June contract ended the week at $123.15/cwt, up $3.53 from
the previous Friday.
March feeder cattle ended the week at $155.87/cwt, up $5.85 from a