Weekly Cattle Outlook: February Futures Close Lower14 January 2013
US - Livestock futures were sharply lower on Wednesday with the release of USDA's Broiler Hatchery report, writes Ron Plain and Scott Brown.
Because of high feed costs, most analysts have been expecting poultry production to be down in 2013. But, USDA says the number of broiler-type eggs set the week ending January 5 was up 1.6 per cent from a year ago. This was the fourth consecutive week with egg set above the year-ago level.
The bearish news continued today with USDA's January production and price estimates. USDA changed their forecast for 2013 beef production from down 5.0 per cent compared to last year to down 4.3 per cent. USDA changed their pork production forecast from down 1.7 per cent to up 0.2 per cent.
Broiler production in 2013 is now predicted to be down 0.4 per cent rather than down 1.3 per cent. Their forecast of turkey production changed from down 3.2 per cent to up 0.3 per cent. Total red meat and poultry production in 2013 is now predicted to be 1.3 per cent lower than in 2012 rather than down 2.6 per cent. USDA increased their estimate of feed and residual for grains by 395 million bushels.
Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $126.36/cwt, up 5 cents from last week and up $2.70 from the same week last year. On a dressed weight basis steers averaged $204.10/cwt this week.
Beef carcass cutout values were mixed this week. On Friday morning, the choice boxed beef carcass cutout value was $194.22/cwt, down 60 cents from last Friday, but up $10 from a year ago. The select carcass cutout was $183.81/cwt, up $1.66 for the week and up $8.16 year-over-year.
This week's cattle slaughter totaled 624,000 head, up 20.2 per cent from the week before, which was light because of New Years Day, but down 3.4 per cent from the same week last year.
The average steer dressed weight for the week ending on December 29 was 873 pounds, unchanged from the week before, but up 26 pounds from a year ago. This was the 51st consecutive week with steer weights above the year-earlier level.
Feeder cattle prices generally have been stronger in early 2013. Price ranges at Oklahoma City auctions this week for medium and large frame #1 steers were: 400-450# $184-$203, 450-500# $174-$190.50, 500-550# $171-$186, 550-600# $161.50-$180, 600-650# $148-$166, 650-700# $150-$164, 700-750# $148-$156, 750-800# $146-$153.25, 800-900# $138.50-$152.85, and 900-1000# $140-$144.50/cwt.
Livestock futures were lower on Wednesday following the release of USDA's Broiler Hatchery report. Because of high feed costs, most analysts have been expecting poultry production to be down in 2013. But, USDA says the number of broiler-type eggs set the week ending January 5 was up 1.6 per cent from a year ago. This was the fourth consecutive week with egg set above year-ago.
The February live cattle futures contract closed at $130.60/cwt, down $2.35 from the previous Friday. April cattle settled at $134.55/cwt, down $2.22 for the week. June fed cattle contracts ended the week at $129.70/cwt.
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