Cattle Quick Thoughts
The May Cattle on Feed Report was released Friday afternoon. Placements continued to outpace last year. May placements into feedlots were up 12 percent or 230,000 head greater than May of last year. Fed cattle marketings were 9 percent higher in May of 2017 than May 2016. The marketings percentage is a little higher due to there being one more slaughter day in May 2017 than in May 2016, though daily average marketings were still higher than last year. Altogether there are three percent more cattle on feed on June 1st of this year than there was June 1st, 2016. Let’s consider what has happened in the first 5 months of 2017. We have placed 825,000 more head of cattle than in the first 5 months of 2016. We have marketed 588,000 more head of cattle than in Jan-May of 2016. The higher marketing rates have been a clear bright spot for the cattle industry as they facilitate movement of cattle through the feeding system. Placements continue to be a major part of the story. There were about one million more calves born in 2016 than in 2015. We are seeing these animals appear as placements this year. The cattle market will continue to depend on the improved beef demand of 2017 to absorb this increase and pull cattle through the system.
Cash traded fed cattle prices were down sharply this week. Fed steers were down $8.72 to an average of $121.51 for live sales through Thursday. Dressed steers were down $16.35 to an average of $193.80.
Feeder cash prices were also lower this week in Mississippi. Mississippi feeder steers weighing 450-500 pounds were down $6 to an average of $151.50 while 750-800 pound steers were down $3.50 to $127.50. Oklahoma City feeder steers weighing 500-550 pounds were down $2.49 to an average of $175.85 while 750-800 pound steers were down $1.91 to $155.09.
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CME was experiencing some type of technical error at the time of this writing. Unfortunately, cattle futures prices are unavailable. I’ll update the Spreadsheet when they become available. Corn futures prices were down 25 cents per bushel this week with July and September at $3.59 and $3.67, respectively.
Boxed beef values were also lower this week. Choice boxes averaged $244.90, down $5.96 from a week ago. Select boxes averaged $218.76, down $2.08 from last week. The choice-select spread shrunk to $26.14, down $3.88 from last week.
Note: all cattle and beef prices are quoted in dollars per hundredweight and corn prices are quoted in dollars per bushel unless stated otherwise.