Weekly Cattle Outlook: Slaughter Down on Last Year and Cattle On Feed Report Down More Than Expectations

US - Slaughter continued to run below last week's levels, write agricultural commentators Ron Plain and Scott Brown.
calendar icon 4 November 2013
clock icon 3 minute read
Ron Plain
Ron Plain

This week's cattle slaughter totaled 624,000 head, up 1.0 per cent from last week, but down 3.3 per cent from a year ago. The average steer dressed weight for the week ending on October 19 was 875 pounds, up 5 pounds from the week before, down 4 pounds from a year earlier, and below year-ago for the sixth consecutive week.

USDA released their cattle on feed report this week. The number of cattle in large feedlots on October 1 was down 7.7 per cent from a year ago. Pre-release trade forecasts were for down 7.4 per cent . September placements were up 1.0 per cent compared to last year. September marketings were up 6.1 per cent thanks to one extra slaughter day. Steer and heifer slaughter during September was up 4.4 per cent . The number of cattle on feed has been down for 14 straight months.

The number of steers in large feedlots at the start of October was down 7.4 per cent . Heifers on feed were down 7.7 per cent . The number of heifers on feed has been declining faster than steers on feed indicating more heifer retention.

The amount of beef in cold storage at the end of September was up 3.4 per cent from the month before and up 4.7 per cent from a year ago.

U.S. beef exports during August were up 6.4 per cent compared to a year earlier. August beef imports were down 7.7 per cent . August beef exports equaled 10.7 per cent of production; imports equaled 7.5 per cent of production. For the first 8 months of 2013, U.S. beef exports were up 3.3 per cent due to a big jump in purchases by Japan. Imports were down 2.9 per cent due to less beef from Canada and Australia.

During August, cattle imports from Mexico were down 29.4 per cent ; imports from Canada were up 18.1 per cent .

Fed cattle prices stayed at record levels this week. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $132.19/cwt, down 19 cents from last week's record, but up $6.01 from the same week last year. Steers sold on a dressed basis averaged $209.07/cwt this week, up $1.27 from last week's record and $12.66 higher than a year ago.

This morning, the boxed beef cutout value for choice carcasses was $204.33/cwt, up $4.14 from the previous Friday and up $12.53 from a year ago. The select carcass cutout is at $189.58/cwt, up $4.40 for the week and up $14.13 from the same day last year.

Oklahoma City feeder cattle auction prices were steady to $2 lower this week. Prices for medium and large frame #1 steers by weight were: 400-450# $207-$225, 450-500# $197-$208, 500-550# $176-$196.50, 550-600# $172-$182.50, 600-650# $162-$176, 650-700# $147-$174.50, 700-750# $153.50-$174.50, 750-800# $149.25-$166.50, 800-900# $156-$162.25, and 900-1000# $148.25-$149/cwt.

The December live cattle futures contract closed at $132.07/cwt today, down 90 cents from last week's close. February fed cattle settled at $133.47, down 55 cents for the week. The November feeder cattle futures contract ended the week at $163.50/cwt, down $3.15 from the previous Friday.

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