Beef cutout, wholesale prices take sharp drop
Prepared and written by Jeff Swenson, DATCP Livestock and Meat Specialist. The Market Update draws information from several sources, including trade publications, radio broadcasts, agricultural news services, individuals involved in the industry as well as USDA NASS and AMS reports.
The beef cutout value dropped $11.00 last week and is lower this week. Distributors are reporting lower wholesale beef prices. Cattle prices were steady after finishing a full $1.00/cwt lower last week. Some feedlot operators are holding out for higher prices.
It has been difficult for producers to negotiate higher prices as weekly harvest numbers have limited their leverage. Last week’s estimated harvest of 637,000 was 4,000 head lower than the previous week and 27,000 below the same week a year ago.
Transportation issues have hampered livestock movement. The lack of truck drivers has caused challenges in getting cattle to market and to their end destination in parts of the country.
Beef cow harvest has been running higher this year, and now the number of dairy cows heading to market is also increasing. Both of these categories were 11 percent higher in the third quarter compared to 2020. Beef export sales last week totaled 16,100 metric tons. China has developed a taste for U.S.-raised, grain-finished beef during the short time exports have been allowed there.
Pork values on the rise
Pork cutout values have been on the rise led by gains in hams and bellies. The latest weekly export sales were for 22,100 metric tons of pork. That comes after 42,600 metric tons the previous week.
Mexico’s recent purchases of large quantities of hams has been notable. China continues to purchase U.S.-raised pork, even as low prices and over production are reported there.
The decreased supply of market-ready hogs and strong demand, both foreign and domestic, have spurred gains in Lean Hog futures contracts. The recent bullish Hogs and Pigs Report has brought optimism for pork producers. Year-to-date hog harvest is running 1.8 percent below last year. Last week’s harvest estimate was 2.524 million head, 54,000 hogs lower than the previous week and 88,000 down from the same week a year ago.
Exports set record
Beef exports set a record in August while pork exports remain at a record pace. August beef exports totaled 132,577 metric tons (mt), up 21 percent from a year ago and the second largest volume this year, while export value climbed 55 percent to $1.04 billion. August beef export value equated to a record $468.75 per head of fed harvest, up 55 percent from a year ago.
Through August, export value was up 28 percent. Exports accounted for 16.4 percent of total August beef production. Pork exports totaled 225,822 mt in August, up 4 percent from a year ago, and value increased 20 percent. August pork export value equated to $59.74 per head harvested, up 26 percent from a year ago. Exports accounted for 28.3 percent of total August pork production.
August exports of U.S. lamb was 32 percent below last year at 1,015 mt, while value slipped 2 percent. Muscle cut exports increased significantly from last year’s low total, reaching 193 mt led by growth in Mexico, the Caribbean, and Central America.
Harvest heads toward finish line
Corn silage harvest was 91 percent complete in Wisconsin according to the latest Crop Progress Report, with harvest for grain 12 percent complete. Soybean harvest was estimated at 31 percent complete in the state.
WI market roundup
Choice beef breed steers and heifers at Wisconsin and surrounding state auction markets were steady. High-yielding, high-grading cattle brought $108.00 to $124.00/cwt with highs to $125.00/cwt. Choice and Prime Holstein steers were steady to $1.00 higher at $91.00 to $115.00/cwt. Silage fed, under finished, or heavy dairy breed steers brought $70.00 to $91.00/cwt.
Dairy x beef steers were mostly $90.00 to $117.00/cwt. Cows were lower, bringing $35.00 to $58.00/cwt. Blemish-free cows in fleshier condition were topping at $70.00/cwt. Doubtful-health and thin cows were bringing $35.00/cwt and down. Dairy breed bull calves were steady to lower at $40.00 to $85.00/cwt with heavier, well cared for calves up to $140.00/cwt.
Beef and beef cross calves brought up to $295.00/cwt. Market lambs sold to $205.00/cwt with reports of some shorn market lambs up to $255.00/cwt.