Ample supply of fed cattle allows packers to bid lower
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.
Last week, Gov. Tony Evers announced the creation of the Meat and Poultry Supply Chain Resiliency Grant Program, investing up to $10 million in the program to continue to grow Wisconsin’s meat processing industry and improve the long-term viability of the state’s livestock industry.
Funded through the American Rescue Plan Act (ARPA), Wisconsin meat processors will have the ability to apply for grants of up to $150,000. The grants are open to Wisconsin meat and poultry processing establishments and businesses involved in rendering.
The application period is open through August 19. More information about the Meat and Supply Chain Resiliency Grants, including the application and FAQs, is available at https://bit.ly/3PM5NYg
Beef on the move
Friday’s Cattle on Feed report showed another large month of cattle placed in feedlots. Placements were just one percent below April 2021, while the trade estimate ranged from 93.6 to 97.8 percent with an average guess of 96.1.
Cattle on Feed on May 1 totaled 12 million head, two percent higher than the same date last year. Placements in Iowa were 14 percent lower than April 2021 with Kansas and Texas being slightly below 2021. Minnesota, Nebraska, and Colorado placements were higher when compared to 2021.
Live Cattle futures shrugged off the news early this week, closing higher on Monday and Tuesday. The ample supply of fed cattle has allowed packers to bid lower as cash markets are feeling pressure. Packers did put together an impressive harvest last week at an estimated 680,000 head, 23,000 head more than the previous week and up 8,000 head compared to the same week last year.
The Choice beef cutout gained $4.20 last week to end Friday at $262.17 and continued to make gains early this week. Commercial beef production from January through April of this year was 9.35 billion pounds, 1.1 percent above last year and nearly 11 percent higher than the 2016–2020 average.
Pork production falls
Commercial pork production during the first four months of 2022 was 9.11 billion pounds. That is 5.5 percent below last year, but 3.5 percent above the 2016 – 2020 average.
Cash hogs were lower last week. Packer margins have been running in the red. However, the pork carcass cutout did make gains last week ending at $107.11, $3.10 higher than the previous week.
Last week’s estimated harvest of 2.414 million head was 39,000 head higher than the previous week and 23,000 head more than the same week last year. Feeder pig prices remain strong. The USDA reported the cash price on a 40 pound pig at $75.32 last week.
Sheep, lamb numbers down
Sheep and lamb harvest last week was estimated to be 35,000 head, 2,000 head less than both the previous week and the same week in 2021. Fed lamb prices were called $10.00 to $40.00/cwt lower last week, although prices did vary by region. Negotiated prices ranged from $204.05 to $245.00/cwt last week with a $216.20/cwt weighted average.
Livestock market roundup
Choice beef breed steers and heifers at Wisconsin and surrounding state auction markets were steady to $1.00 lower. High-yielding, high-grading cattle brought $128.00 to $140.00/cwt.
High Choice and Prime type cattle with an overnight stand at the auction market sold from $140.00 to $148.00/cwt. Choice Holstein steers continued to show strength selling from $99.00 to $128.00/cwt, with high grading Holsteins steers bringing $128.00 to $132.00/cwt.
Silage fed, under finished, or heavy dairy breed steers brought $72.00 to $99.00/cwt. Dairy x beef steers were mostly $100.00 to $143.00/cwt.
Cows were higher at $58.00 to $80.00/cwt. Beef breed cows in fleshier condition sold into the high $80.00s/cwt. Doubtful health and thin cows were bringing $58.00/cwt and down.
Dairy breed bull calves were lower, bringing $40.00 to $100.00/cwt, with heavier, well cared for calves up to $150.00/cwt. Beef and beef cross calves were steady to higher bringing up to $340.00/head. Market lambs were bringing up to $240.00/cwt, with some light market lambs selling to $260.00/cwt.