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Weekly US Cattle Outlook: More Cattle On Feed

28 June 2010
Ron Plain
Ron Plain

US - Weekly Cattle Outlook, 25th June 2010, a weekly review of the US cattle industry, written by Glenn Grimes and Ron Plain.

USDA's June cattle on feed inventory came in close to that predicted by the pre-release trade estimates. The number of cattle on feed at the start of June was up 0.8 per cent compared to June 2009, the same as the average of pre-release trade forecasts. The June inventory is the second lowest on-feed number for any June since 1999.

Placements of cattle on feed during May were up a whopping 23.4 per cent, which was not far from the average trade forecast of up 22.3 per cent. The big percentage increase was due to very low placements in May 2009. Despite the increase, May placements were the fourth lowest in the last 13 years.

Marketings of fed cattle from large feed yards during May were down 4.3 per cent, according to USDA. May marketings were the lowest for any May since USDA began the current data series in December 1995. Steer and heifer slaughter during May was down 4.8 per cent.

Stocks of beef in cold storage on May 31 was down 1.5 per cent from a month earlier and down 13.9 per cent.

The boxed beef cutout rose a tiny bit this week. On Friday morning, the choice boxed beef carcass cutout value was $1.5425/pound, up 0.07 cents for the week and 15.16 cents higher than last year. The select cutout was up 0.37 cents from the previous Friday to $1.4647 per pound.

Fed cattle prices were slightly lower this week. The five-area daily weighted average price for slaughter steers sold through Thursday of this week on a live weight basis was $90.98/cwt, down five cents from a week earlier, but $10.24 higher than a year ago. Steers sold on a dressed weight basis this week averaged $146.09/cwt, 38 cents lower than the week before, but $16.48 higher than last year.

This week's cattle slaughter totalled 667,000 head, unchanged from the previous week and down 0.4 per cent compared to the same week last year.

Steer carcass weights averaged 818 pounds during the week ending 12June. That was up one pound from the week before but 14 pounds lighter than a year ago. This was the 29th consecutive week with steer weights below year-earlier levels.

Cash bids for feeder cattle were mostly steady to a few dollars higher at most auctions this week. Oklahoma City was called steady to $2 higher. The price ranges at Oklahoma City for medium and large frame steers were: 400-500# $135-$148, 500-550# $128.50-$137, 550-600# $120.50-$129.50, 600-650# $107.50-$122.10, 650-700# $109.50-$119.50, 700-800# $111-$117.75 and 800-1000# $98.75-$113/cwt.

The June fed cattle futures contract ended the week at $90.95/cwt, up $1.65 compared to the previous Friday. The August contract gained $1.17 this week to end at $89.37/cwt. The October contract settled at $91.07 and December ended the week at $93.25.

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