USDA report has little impact on cattle market
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.
Cash fed cattle turned lower the end of last week but appear to have recovered. The release of the USDA Cattle on Feed report had little to no impact on the market as no new news came to light. Cattle in feedlots over 1,000 head on March 1 was 4.5% below a year ago. Cattle placed in feedlots during February was 7.2% (134,000 head) less than the same month in 2022.
This information was already baked into the market prior to the release with Live Cattle futures prices continuing to be impacted more by outside factors rather than market fundamentals. Harvest was on pace to equal the week prior but did slow Friday and Saturday. An estimated 631,000 head were harvested, making the total 3,000 less than the previous week and 5,000 below the same week a year ago.
The Choice beef cutout value dropped $1.80 last week to $283.55 and is below the $280.00 level this week. The current cutout value is about $25.00 higher than in 2014, the last time beef cow inventory was at a record low. The all-fresh beef retail price in February was slightly higher at $7.23/pound, compared to $7.20 in January. The Choice beef February retail average was $7.59/pound/an increase of 1.3 cents.
Pork demand falls to pre-pandemic levels
The pork cutout, cash hogs, and Lean Hog futures prices were all lower last week. The trading week ending March 10 saw the June and July Lean Hog futures contracts trading above $100.00/cwt. The June contract was $89.05 at the close Wednesday of this week with July ending the day at $91.08.
Harvest continues to outpace expectations. Last week’s estimate of 2.492 million head was 5,000 below the previous week, but 67,000 hogs more than the same week last year. There is evidence to support the supply of market hogs is higher than the December Hogs and Pigs report indicated. Weights are inching higher, indicating the larger harvests are not a result of pulling hogs forward.
A National Hog Farmer article by Joseph Kerns this week cited data from economist Dr. Steve Meyer showing pork demand has fallen back to pre-COVID-19 levels. More and heavier hogs will make it difficult for prices to work higher.
The average pork retail price in February was $4.77/pound compared to $4.79/pound in January. The pork carcass cutout value dropped $1.40 last week to $80.95. African Swine Fever (ASF) was confirmed in Korea, the fifth case there, and Cebu (a province of the Philippines). China is also dealing with a resurgence of ASF with widespread fresh outbreaks being reported.
Lamb prices up
Market lamb prices were higher again last week, even as wholesale prices showed weakness. Retail features of lamb were sharply higher, mostly on Shoulder Blade Chops and Shoulder Round Bone Chops. The gross lamb carcass cutout value ended last week at $523.74 and that was $3.83 lower.
Last week’s estimated harvest of 36,000 matched the previous week and was 3,000 head higher than the same week last year. Average live weights at harvest are eight pounds higher than a year ago. Lamb and mutton production is now 5.2% higher year-to-date compared to 2022, while harvest volume by head is 8.1% higher.
State livestock market roundup
Fed cattle prices at Wisconsin and surrounding state auction markets were steady to higher, but selling in a large price range. High-yielding, high-grading cattle brought $135 to $162/cwt. Groups of high Choice and Prime lots sold from $160 to $174/cwt.
The Holstein steer market was steady ranging from $114 to $142/cwt with the top end bringing $142 to $145 and some packages above. Silage fed, under finished or heavy dairy breed steers brought $78 to $113/cwt. Dairy x Beef steers were bringing $107 to $155/cwt.
Cows were $1 higher. A bulk of the cows brought $65.00 to $88.00/cwt with some selling to $100/cwt and above. Doubtful health and thin cows were bringing $65/cwt and down.
Dairy breed bull calves were steady to strong, bringing $100 to $250/cwt with heavier, well cared for calves selling up to $290/cwt. Beef and Beef Cross calves were selling to $450/cwt with a few higher. Shorn market lambs were bringing $141 to $152/cwt with reports of some light lambs selling higher.