Weekly Cattle Outlook: June Feedlot Placements Fall

US - The July cattle on feed report said June placements were down 4.6 per cent and marketings were down 3.6 per cent, write Ron Plain and Soctt Brown.
calendar icon 22 July 2013
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Ron Plain
Ron Plain

The total on feed at the start of July was down 3.2 per cent. The pre-release trade estimates were for June placements to be down 5.1 per cent and June marketings down 5.3 per cent . There was one fewer slaughter day this June than last.

Domestic beef demand in May was up 0.7 per cent compared to a year ago. After three consecutive down months, export demand for U.S. beef was up a solid 6.2 per cent in May. Consumer meat demand was 0.9 per cent stronger this May than last.

Retail prices for choice beef in June averaged $5.294 per pound. That was up 5.3 cents from the average in May, up 36.2 cents from a year ago, and less than a penny under the $5.30/pound record set in March. All fresh beef averaged $4.90 per pound in June.

Crop growing conditions are much better than a year ago. As of July 15, 66 per cent of corn acres were rated in good or excellent condition. That is down 2 percentage points from the week before, but up 35 points from a year ago. 28 per cent of U.S. pastures were rated in poor or very poor condition on July 15, down from 54 per cent poor or very poor a year ago.

Fed cattle prices were a bit lower this week. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $120.71/cwt, down 53 cents from last week, but up $7.81 from the same week last year. Steer prices on a dressed basis averaged $191.00/cwt this week, down 73 cents from a week ago, but up $12.11 from a year ago.

This morning, the boxed beef cutout value for choice carcasses was $189.51/cwt, down $2.35 from the previous Friday, but up $9.37 from a year ago. This was the eighth consecutive week with lower choice cutout. The select carcass cutout is at $184.32/cwt, up 30 cents for the week. The choice-select price spread dropped $2.65 this week to $5.19/cwt.

This week's cattle slaughter totaled 651,000 head, up 1.7 per cent from last week, but down 0.3 per cent from a year ago. The average steer dressed weight for the week ending on July 6 was 860 pounds, up 5 pounds from the week before and up 1 pound from a year ago.

Oklahoma City feeder cattle auction prices this week were $2 lower to $4 higher with prices for medium and large frame #1 steers: 450-500# $172-$184.50, 500-550# $163-$186, 550-600# $156-$174.75, 600-650# $145-$164.25, 650-700# $137-$156, 700-750# $142.75-$151.75, 750-800# $137.75-$150, 800-900# $132.85-$148.50, and 900-1000# $127.50-$138/cwt.

The August live cattle futures contract closed at $121.97/cwt today, up 12 cents from last week's close. The October fed cattle contract gained 15 cents from last Friday to settle at $126.22/cwt. December ended the week at $128.72/cwt. August feeder cattle futures settled at $152.25/cwt, up $2.13 for the week. The September contract gained $2.53 from last Friday to close at $155.25/cwt. October settled at $157.20/cwt.

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