The 2-ton monkey in the cattle closet—increasing fed cattle supplies through spring and into summer—continued to cast a shadow over positive fundamentals this week. Among the positives were steady to higher cash fed cattle trade, continued strength in wholesale beef values and snug front-end supplies.
Steers and heifers traded from steady to $4 per cwt lower, according to the Agricultural Marketing Service (AMS). However, there were instances of steady to higher prices for cattle suited to summer turnout.
For instance, steers and heifers weighing less than 725 pounds in light to moderate flesh traded steady to $5 higher at Tuesday’s Kingsville Livestock Auction in Missouri. The AMS reporter there explained, “Despite futures trending lower and the fed cattle market under pressure with large supplies expected through the summer months, buyers continue to be optimistic about grass cattle. Demand was good for cattle suitable for grazing, however demand was light for heavier weights and fleshier cattle as feedlots are abundant with feeders staring down the June and August Live contract lows.”
Feeder Cattle futures closed an average of $3.02 lower, week to week on Friday ($2.47 to $3.70 lower).
“Losses of $9 to $12 on spring and summer Feeder Cattle futures contracts in the past four weeks has put a damper on many producers’ attitudes,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Fall and winter contracts have only declined $7 over the same time period, but the sentiment would be that they have time to fall further.”
Weather continues to alter marketing and management plans, too.
Listen to Wes Ishmael's Cattle Market Weekly Audio Report every Saturday morning on the BEEF magazine website. This is your report for Saturday, Mar. 17, 2018.