Buyers continued to bid aggressively for feeder cattle this week, receiving added support from a rally in futures prices.
Feeder steers and heifers traded mostly steady to $6 per cwt higher, according to the Agricultural Marketing Service (AMS). Prices were uneven for calves as more of them start coming to market. Some auctions reported steady to higher prices for heavier, weaned calves, while buyers generally applied more pressure to bawlers.
Although improved forage conditions in the Southern Plains may increase incentives to background calves, placements in feedlots during the fourth quarter are expected to remain relatively large, given the availability of cattle outside feedlots. But expected declines in cattle feeding margins will likely encourage feedlots to bid down the price of calves in the coming months.
The ERS price forecast for feeder steers (750-800 lbs.) in the fourth quarter is $140-$146 per cwt. First-quarter prices are projected at $132-$140.
Feeder Cattle futures closed an average of $4.94 higher week to week on Friday ($3.17 to $6.90 higher).
In fact, the $11-$14 run higher in Feeder Cattle futures over the past month has prices at a point that seem to defy seasonal and conventional reality.
Listen to Wes Ishmael's Cattle Market Weekly Audio Report every Saturday morning on the BEEF magazine website. This is your report for Saturday, SEPT. 23, 2017.