Although wet and muddy conditions continued to hamper cattle movement in some areas, the fall calf run began in earnest this week with sharply higher auction receipts and many barns holding their first calf sales of the season.
Overall, steer and heifer calves sold steady to $5 per cwt lower, according to the Agricultural Marketing Service (AMS). Yearling steers and heifers sold steady to $3 lower.
“The best demand for calves this week was for very lightweight offerings of either sex as buyers have their sights on next year's yearling market,” explained the AMS reporter at Miles City Livestock Commission in Montana Tuesday. “Many of these offerings are going to local feeders or hay meadows to wean while they wait for turnout time for wheat pasture in the Southern Plains.”
Calf health risk, defined in part by weaning and vaccination management, continued to be key to price differentiation.
“The wide price spreads seen in this report reflect how important a full vaccination program is this year,” explained the AMS reporter at Tuesday’s Mobridge Livestock Auction in South Dakota. “Harsh spring weather, the recent cold and wet fall weather, and poor lot conditions are all factors contributing to caution exhibited by buyers trying to procure calves that have the least chance of getting sick.”
With that said, more promising winter forage conditions so far continue to underpin calf and feeder prices. Pasture conditions continued to improve week to week, according to the latest USDA Crop Progress report. Although 2% behind the five-year average, winter wheat planting is running 7% ahead of last year with 65% in the ground. At 44%, emergence is 9% more than last year and 3% more than average.
Cattle futures mostly softened week to week, amid uncertainty and light interest.
Week to week on Friday, Feeder Cattle futures closed an average of 85 cents lower (5 cents to $1.92 lower)—an average of $4.79 lower in the last two weeks.
Analysts with USDA’s Economic Research Service raised expected feeder cattle prices (OKC, 750-800 pounds) to $150-$156 per cwt for the fourth quarter, based on expectations of continued strong demand.
ERS estimates feeder prices at $141-$149 per cwt in the first quarter next year, $143-$153 in the second quarter and $145-$155 in the third quarter.
Fed cattle prices remain near steady
Week to week on Friday, Live Cattle futures closed narrowly mixed, but mostly lower from an average of 42 cents lower to an average of 52 cents higher.
ERS raised the expected fourth-quarter price for fed steers (Five Area direct) to $110-$114 on a projected slower marketing pace.
Listen to Wes Ishmael's Cattle Market Weekly Audio Report every Saturday morning on the BEEF magazine website. This is your report for Saturday, Oct. 20, 2018.