Cash trade ended the week mostly steady with last week’s trade. The 5-Area live fed price was $122.08/cwt on Friday compared to $121.91 last week. The decline in prices at this time of the year is not uncommon, but appears to be happening earlier than normal. This backing up of the seasonal trend has taken place each of the last two years and it is looking like the same story is unfolding in 2012. Live cattle in Texas sold at $122/cwt, while Kansas live cattle traded at $122.50/cwt. In Nebraska, live and dressed cattle traded at $122-$123.50/cwt and $194-$195/cwt, respectively, on Wednesday. Feeder cattle in Oklahoma City were called steady to $2/cwt lower and claves were mostly steady. In Mississippi markets, feeder steers were $1-$10/cwt higher and feeder heifers were $2-$5/cwt higher. Slaughter bulls and cows were called $1-$3/cwt higher in Mississippi.
Both live and feeder cattle futures were higher this week. All contracts were up strong Thursday as a result of improved cash trade. The sentiment seemed to snowball and buying brought on more buying. Some traders and economists think the sell-off went beyond the market fundamentals. Demand remains a large question mark heading into the summer grilling season. Prices improved more as the contract month moved further out.
Corn futures were lower on the week with old crop contracts suffering the steeper losses. The USDA released their monthly supply and demand report on Tuesday and projected corn ending stocks were unchanged which was a surprise to analyst that had expected a drop.
Wholesale beef prices continued to slip. Choice boxed beef ended the week at $177.79/cwt, down $3.00. Select boxed beef was $177.20/cwt, down $1.52. Prices fell each day of the week until Friday. The milder winter and now spring could have retailers gearing up for summer grilling season earlier than usual, but it is still too early to know for sure.
World Agriculture Supply and Demand Estimates:
USDA released their monthly supply and demand report on Tuesday. With respect to beef, 2012 forecasted production was increased 50,000 pounds as higher slaughter weights are pushing total pounds of beef up. Slower pace of slaughter in the first quater of the year helped to off-set the production number a bit. Per capita consumption was increased as well, from 54.9 pounds per person in March’s report to 55.4 this month.