Cash cattle were lower this week. In the Southern Plains live sales were at $120/cwt. In Nebraska and Iowa, dressed sales were at $195/cwt.
Feeder steers and heifers in Oklahoma City were $1-$3/cwt higher. In Mississippi auction markets feeder steers were mixed and feeder heifers were called steady. Cull bulls were steady and cows were $2/cwt lower.￼￼
Live cattle futures finished the week lower, while feeder futures were higher. Prices moved sharply higher on Tuesday as an uptick in beef prices provided support. Two other fundamental factors currently in play are the current basis levels and higher temps for the major feeding region. Cash prices had been about $3-$4/cwt above the June contract, but they are slowly converging as the June contract moves toward expiration (at the end of the month). Increasing temperatures are expected to decrease gains and lower total production, which should add support. The week ended with lower prices as cash sales came in lower for the week.
Corn futures finished lower. Wednesday’s supply and demand report was rather bearish for corn (for a detailed recap of the report for crops click here). Many expected a downward adjustment in total acres due to the cold and wet spring. The report did not make any adjustments (which is typical from USDA this early in the season without some hard evidence to support this hypothesis).
Wholesale boxed beef prices slid again this week. Choice finished with a weekly average of $201.62/cwt, down $2.59, and Select finished at $184.01/cwt, down $0.45.
Supply and Demand Report:
USDA released their monthly World Agriculture Supply and Demand Estimates report on Wednesday. Total beef production for the current year was raised from 25.107 billion pounds to 25.437 due to an increased number of cattle and cows being fed for slaughter. The drought appears to still have a grasp on portions of the U.S. In addition, exports were lowered to 2.312 billion pounds, down 100 million. Higher beef prices and a stronger U.S. dollar has put a damper on trade in 2013. Domestic consumption was incased to 57.1 pounds per person. This is largely a function of more beef that has to be consumed – from higher production and lower exports – since storing beef for long periods of time is, well, not possible.