Report: Beef production falls compared to 2021

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 USDA released its latest monthly Livestock Slaughter report showing that beef production in July was three percent below last year. The number of head harvested was two percent lower, and the average live weight decreased by eight pounds compared to a year ago.

Cows and heifers harvested in July made up over 51 percent of the total. Steers harvested was 8.2 percent below last July, while heifers were 4.8 percent higher and beef cow harvest was 10.6 percent higher. Dairy cow harvest was seven percent lower than July 2021.

Recent rain in areas most impacted by drought in recent weeks has slowed the number of beef cows heading to market in August, and we could see numbers go against typical season trends in the fall when cow harvest usually increases. Last week’s estimated harvest was 678,000 head, up 17,000 head from the previous week and 25,000 head higher than the same week a year ago.

The Choice beef cutout ended last week $1.20 lower at $262.76. While the cutout is over $80.00 lower than this time last year, fed steer prices are $18.50/cwt higher. According to the Sterling Profit Tracker, the cost of feeding a steer to finished weight for cattle marketed last week was 25 percent higher than a year ago. The cost to finish steers placed on feed last week is projected to be 31 percent higher.

Domestic pork demand strong

Domestic pork demand has been strong and hog supply has not increased, but that did not stop cash hog prices and cutout values from losing ground. Cash hog prices were sharply lower last week, giving up nearly $7.00/cwt while the pork cutout value dropped $14.75 to finish Friday $102.23.

Total pork production in July was down four percent compared to last year. Hog harvest was five percent lower. There was one less workday in July 2022 than 2021. Live weights were three pounds higher, averaging 284 pounds in July. The number of sows heading to market the first seven months of 2022 is lower than last year, and the national sow inventory is also lower.

Sows made up 2.6 percent of the January through July total, the same as 2021. The estimated harvest last week was 2.393 million hogs, 2,000 hogs lower than the previous week and 38,000 hogs fewer than the same week last year.

Pork packer capacity utilization reported by the Sterling Profit Tracker was estimated at 88.8 percent compared to 88.9 percent the previous week and 90.4 percent last year.

Lamb numbers fall

Lamb and mutton production in July was five percent lower than last year. Sheep and lamb harvest was 14 percent lower than a year ago. Heavier weights helped offset the decline in harvest with the average live weight 11 pounds higher at 126 pounds.

Total estimated harvest last week was 32,000 head and that was 1,000 head less than the week before and 2,000 head behind the same week last year. The lamb carcass cutout was $3.80 higher last week at $578.71. While cash lamb prices were uneven nationwide, the USDA called prices $4.00 to $6.00/cwt higher.

Fed cattle market pressure continues

Pressure in the fed cattle market continued into this week. Choice beef breed steers and heifers at Wisconsin and surrounding state auction markets were steady to $2.00 lower. High-yielding, high-grading cattle brought $123.00 to $143.00/cwt.  Some markets reported packages of steers and heifers from $144.00 to $148.00/cwt and some exceptional groups above.

Choice Holstein steers were steady to weak at $107.00 to $134.00/cwt with high grading Holstein steers bringing $134.00 to $139.00/cwt. Silage fed, under finished, or heavy dairy breed steers brought $75.00 to $107.00/cwt. Dairy x beef steers were $2.00 lower, bringing  $105.00 to $144.00/cwt.

Cows were weak with the bulk selling $2.00 to $5.00 lower from $50.00 to $78.00/cwt with some selling to the high $80.00’s and reports of some beef types selling higher. Doubtful health and thin cows were bringing $50.00/cwt and down.

Dairy breed bull calves were lower, bringing $40.00 to $125.00/cwt with heavier, well cared for calves up to $140.00/cwt. Beef and beef cross calves were mostly steady, selling to $330.00/head. Market lambs brought $96.00 to $110.00/cwt with reports of tops at $185.00/cwt. Some markets reported lighter lambs above $200.00/cwt.