Sep 23, 2014
Home| Tools| Events| Blogs| Discussions Sign UpLogin

Market Highlights: Cattle on Ice

August 19, 2014
BT Rotator Heifers Winter
Cattle prices have been put on ice with markets falling off a bit.  

Cattle prices have been put on ice with markets falling off a bit. 
By: Andrew P. Griffith, University of Tennessee

FED CATTLE: Fed cattle traded $5 to $6 lower on a live basis this week compared to last week. Prices on a live basis were mainly $154 to $156 while dressed trade occurred between $241 and $244. The 5-area weighted average prices thru Thursday were $154.74 live, down $6.01 from last week and $243.69 dressed, down $9.78 from a week ago. A year ago prices were $123.86 live and $196.86 dressed.

It appears fed cattle marketings are becoming less current as steer and heifer weights are about eight pounds heavier than the same week a year ago. The reduced harvest of cattle this summer is likely the prime suspect to why cattle marketing are less current. This leaves feedlot managers needing to move cattle in the near future.

Packing facilities have been watching slaughter rates closely to help support cutout prices. The reduced slaughter also left them paying higher prices for fed cattle, but has now put feedlots in a situation where they will have to move some product. Softness in the fed cattle market may persist the next few weeks, and prices could dip into the $140s.

Slaughter

BEEF CUTOUT: At midday Friday, the Choice cutout was $256.04 down $0.70 from Thursday and down $5.29 from last Friday. The Select cutout was $250.21 down $1.64 from Thursday and down $3.48 from last Friday. The Choice Select spread was $5.83 compared to $7.64 a week ago. Both the Choice and Select cutouts have faltered the previous two weeks, but prices remain strong relative to previous years.

In recent weeks, wholesale prices for many beef products have been 30 to 50 percent higher than the same weeks a year ago. Cuts such as the chuck and round are two prime examples of beef products that have experienced a significant price increase. Similarly, 90 percent lean and 50 percent lean trimmings have experienced price spikes relative to a year ago.

Cutout

The prices of these cuts and products are strongly supported by the demand for ground beef. A larger percentage of chucks and rounds are being ground this year relative to a year ago which supports the price of the two cuts.

It is evident consumers prefer the taste of beef over competing meats, because they continue to step up to the beef counter.

Cutout prices have the potential to dip lower the next several weeks. One supporting factor will be Labor Day beef purchases as retailers will try to move product during the last grilling holiday of the season.

TENNESSEE AUCTIONS: On Tennessee auctions this week compared to a week ago steers and bulls under 500 pounds were $8 to $15 lower while those over 500 pounds were $2 to $10 lower. Heifers were $5 to $13 lower. Slaughter cows and bulls were steady. Average receipts per sale were 659 head on 10 sales compared to 691 head on 11 sales last week and 850 head on 10 sales last year.

Tennessee

OUTLOOK: Calf and feeder cattle prices were put on ice this week as all classes stumbled. Signs of the market faltering were evident late last week with the announcement from Russia with regards to imposing import bans on agricultural products from the United States and other countries.

That news caused a knee-jerk reaction from futures traders who sold off contracts resulting in multiple days of the market moving down the $3 limit for most contracts. It is difficult to say if the decline in cash prices is completely due to Russia’s announcement or if another factor is at play.

READ MORE
Previous 1 2 Next

See Comments


 
Log In or Sign Up to comment

COMMENTS

No comments have been posted



Name:

Comments:

Receive the latest news, information and commentary customized for you. Sign up to receive the AgWeb Daily eNewsletter today!.

 
 
Enter Zip Code below to view live local results:
bayer
 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions