Coming weeks will tell the story for beef demand
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 coming weeks will be a telling time for beef demand. With Independence Day over and the Dog Days of summer upon us, it is expected consumers will continue seeking lower priced cuts.
Cattle prices will depend on how many cattle were marketed early – the lower live and carcass weights in recent weeks indicate cattle were pulled ahead. Packers continued to buy cattle at steady to higher money through last week, actively seeking out cattle.
Lower country bids were turned down early this week with prices through auction markets mostly steady to lower this week. There is still a large number of cattle in feedlots according to the latest USDA Cattle on Feed report.
May saw the lowest placements since 2011 with expectations for lower placements to continue not only the rest of the year but in 2023 as well. Estimated cattle harvest for the week ending July 2 was 636,000 head, 30,000 head less than the previous week. The decrease was realized on Saturday as many packers gave employees a long Holiday weekend.
The Choice beef cutout value lost $0.40 on the week, finishing Friday at $263.82.
Supply of market hogs to continue running lower
Market hog supply has been running 1.3 percent below last year, and that trend will continue through the fourth quarter of 2022. Domestic supplies of pork could increase as a strengthening U.S. dollar may curb exports.
The pork cutout value lost $3.50 last week mostly on the weakness of bellies, ending at $108.75. However, it gained ground early this week and was $114.48 Tuesday afternoon.
The weekly estimated harvest was 2.386 million hogs, 18,000 hogs less than the previous week and 14,000 hogs more than the same week last year.
Historic low sheep numbers
Last week’s estimated sheep and lamb harvest of 32,000 head matched the previous week and was 3,000 head behind the same week in 2021. Market lambs were mostly lower again last week as they continue their seasonal trend. Mature sheep harvest has dropped below the five-year average. This can be partly explained by historically low sheep numbers, but there are reports of flock rebuilding and expansion taking place.
Weather pressures grain prices
Corn prices will continue to be influenced by weather until harvest totals and yields are estimated. Corn and soybean futures prices have been pressured by rain experienced in the Cornbelt and a favorable forecast.
The USDA Quarterly Grain Stocks report released on June 30 showed corn stocks of 4.35 on June 1, six percent higher than the same time last year. On-farm corn stocks were 22 percent higher than a year ago.
Soybeans in storage in the U.S. totaled 971 million bushels, 26 percent more than June 1, 2021. On-farm soybean stocks were 51 percent higher than a year ago.
Corn condition in Wisconsin was 76 percent good to excellent statewide, down two percentage points from last week according to the latest Crop Progress report compared to 64 percent nationally. Wisconsin soybean condition was 76 percent good to excellent, down one percentage point from last week and compares to 63 percent rated good to excellent nationally.
State livestock market roundup
Choice beef breed steers and heifers at Wisconsin and surrounding state auction markets were mixed. High-yielding, high-grading cattle brought $130.00 to $147.00/cwt.
High Choice and Prime type cattle with an overnight stand at the auction market sold from $145.00 to $153.00/cwt. Choice Holstein steers were mixed at $105.00 to $130.00/cwt with high grading Holstein steers bringing $130.00 to $135.00/cwt with a few higher.
Silage fed, under finished, or heavy dairy breed steers brought $72.00 to $104.00/cwt. Dairy x beef steers were bringing $107.00 to $145.00/cwt.
Cows were lower at $60.00 to $82.00/cwt with some selling to the low $90.00s. Doubtful health and thin cows were bringing $60.00/cwt and down.
Dairy breed bull calves were steady, bringing $50.00 to $165.00/cwt with heavier, well cared for calves up to $185.00/cwt. Beef and beef cross calves were bringing up to $360.00/head. Market lambs brought up to $200.00/cwt.