CATTLE OUTLOOK - Ron Plain and Scott Brown
Ag Economics, MU May 15, 2015
The May WASDE gave its first forecast of 2016 production and prices.
USDA expects 2016 beef production to be up 1.0% from this year and
they expect this year’s beef production to be up 0.1% from last year.
Slaughter steers averaged $154.56/cwt live in 2014. They are looking
for prices to be $4-12 higher this year and about the same in 2016 as
USDA expects beef imports to decline 9.5% and beef exports to increase
2% in 2016. This will keep the domestic per capita beef supply very
tight and support prices. USDA is forecasting 2016 per capita beef
consumption at 53.9 pounds of retail weight; that will be the lowest
Fed cattle prices this week were higher on light volume. Through
Thursday, the 5-area average price for slaughter steers sold on a live
weight basis was $160.82/cwt, up $1.05 from last week’s average and up
$13.87 from a year ago. The 5 area average dressed price this week
for steers was $256.55/cwt, up $1.51 for the week and up $22.49
compared to the same week last year.
This morning the choice boxed beef cutout value was $262.69/cwt, up
$4.49 from the previous Friday and up $35.97 from a year ago. The
select carcass cutout was $250.52/cwt this morning, up $3.72 from last
week and up $33.52 from a year ago. The choice-select price spread is
wider than normal at $12.18/cwt.
Cattle slaughter this week totaled 569,000 head, up 0.4% from the week
before, but down 4.5% from the same week last year. Year-to-date
cattle slaughter is down 7.2% and beef production is down 4.9%. The
average steer dressed weight for the week ending on May 2 was 865
pounds, down 1 pound from the week before, but up 25 pounds compared
to the same week last year. Weights have been up for 46 consecutive
USDA rated 56% of pastures in the 48 contiguous states as being in
good or excellent condition on May 10. That is up from 53% good or
excellent last week and 41% good or excellent a year ago.
Feeder cattle prices at Oklahoma City were mostly steady to $3 higher
this week. Prices for medium and large frame #1 steers by weight
group were: 400-450# $295-$329, 450-500# $286-$314, 500-550#
$272-$299, 550-600# $247.50-$285, 600-650# $240-$256, 650-700#
$228.50-$242.50, 700-750# $221-$231.50, 750-800# $213.50-$225.50,
800-900# $192.50-$215.50, and 900-1000#, $189-$201.75/cwt.
Cattle futures were higher this week. The June live cattle futures
contract settled at $152.52/cwt today, up $1.02 for the week. August
fed cattle settled at $150.80/cwt, up 98 cents from the previous week.
October fed cattle gained 47 cents this week to settle at $151.67/cwt.
The May feeder cattle contract ended the week at $219.00/cwt, up $3.13
for the week. August feeders ended the week 78 cents higher at