Oldtimer
Well-known member
The results of the glut of cattle are beginning- but we are still IMPORTING beef and cattle at record numbers :roll:
Today 3/31/2006 4:13:00 PM
Feeder Cattle: Nearby Future Looks Like A Red-Ink River
Compared to last week, feeder cattle prices came out of the gates slightly higher with support lent from last week's higher market. However, bearish pressure weighed on feedlot-bound cattle which ended the week unevenly steady to 2.00 lower with the full decline on weights over 850 lbs. The only bright spot on the true feeder cattle was on those lightweight enough and with condition suitable for grass interests that are currently mesmerized by the color green. Calf prices were very uneven this past week with good demand for thin-fleshed quality calves while fleshy new crops and plainer offerings were much harder to sell in many locations. Southeastern calf markets trended 3.00 higher to 5.00 lower with active trading in some early-week venues like the Blue Grass Stockyards in Lexington, Kentucky, but much slower market activity reported in many smaller auctions across the South. By far, this week's best demand was on longtime weaned, old crop calves and thin "green" yearlings in the Midwest and Plains. The 600-700 lb stocker steers at the Oklahoma National Stockyards were quoted 6.00-10.00 higher. This resulted in a steer/heifer price spread of well over 20.00 cwt which is curiously similar in many other locations. Buyers want cattle that can hit Flint Hills or Osage pastures with their heads down and never look back, while not letting freight eat up their profit potential. Although, the price tag on these stockers may not leave much room for a profit if the fed cattle market doesn't stabilize soon.
Feedlots sold showlists 2.00 lower this week from 84.00-84.50 and the nearby future looks like a red ink river. April through October CME live cattle contracts all ended the week below 80.00 with sharp losses on Friday's session following the release of the USDA's Prospective Plantings Report. Expected corn acreage came out well below expectations at 78 million acres and projected soybean acres were quoted well above analysts predictions at 76.9 million acres. Cattle feeders have operated for the past few years with the benefits of cheap corn, but lower production and the added demand from ethanol plants could change this luxury, not to mention the possibility of a dry year and low yields. Fed cattle prices are expected to trade in the mid 70's this summer while most breakevens on these cattle are over 85.00. However, some optimists believe that unusually large feedlot placements over the past few months, due to the dry winter across the Plains, will be offset by extremely tight supplies of feeders available this spring. The size of the graze-out wheat runs will tell the tale as most pastures are empty and the hot-wire has already been rolled up. However, there are a few spots off the main highway, like northwestern Oklahoma, where cattle continue to enjoy graze-out wheat.
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From Cattlenetwork:
"Beef exports in January were up 83% from 12 months earlier, but down 59.1% from January 2003, before BSE in North America.
The first month of 2006 saw a 20% increase in beef imports into the U.S. Much of the increase in our beef imports was from Australia. For some reason beef imports from Australia were quite small in January of 2005.
Our imports of feeder cattle from Mexico in January were up 24.7% from 12 months earlier. Our total live cattle imports in January were up 137.8% from 12 months earlier. Remember, the border to live cattle imports did not open until sometime in July last year."
Today 3/31/2006 4:13:00 PM
Feeder Cattle: Nearby Future Looks Like A Red-Ink River
Compared to last week, feeder cattle prices came out of the gates slightly higher with support lent from last week's higher market. However, bearish pressure weighed on feedlot-bound cattle which ended the week unevenly steady to 2.00 lower with the full decline on weights over 850 lbs. The only bright spot on the true feeder cattle was on those lightweight enough and with condition suitable for grass interests that are currently mesmerized by the color green. Calf prices were very uneven this past week with good demand for thin-fleshed quality calves while fleshy new crops and plainer offerings were much harder to sell in many locations. Southeastern calf markets trended 3.00 higher to 5.00 lower with active trading in some early-week venues like the Blue Grass Stockyards in Lexington, Kentucky, but much slower market activity reported in many smaller auctions across the South. By far, this week's best demand was on longtime weaned, old crop calves and thin "green" yearlings in the Midwest and Plains. The 600-700 lb stocker steers at the Oklahoma National Stockyards were quoted 6.00-10.00 higher. This resulted in a steer/heifer price spread of well over 20.00 cwt which is curiously similar in many other locations. Buyers want cattle that can hit Flint Hills or Osage pastures with their heads down and never look back, while not letting freight eat up their profit potential. Although, the price tag on these stockers may not leave much room for a profit if the fed cattle market doesn't stabilize soon.
Feedlots sold showlists 2.00 lower this week from 84.00-84.50 and the nearby future looks like a red ink river. April through October CME live cattle contracts all ended the week below 80.00 with sharp losses on Friday's session following the release of the USDA's Prospective Plantings Report. Expected corn acreage came out well below expectations at 78 million acres and projected soybean acres were quoted well above analysts predictions at 76.9 million acres. Cattle feeders have operated for the past few years with the benefits of cheap corn, but lower production and the added demand from ethanol plants could change this luxury, not to mention the possibility of a dry year and low yields. Fed cattle prices are expected to trade in the mid 70's this summer while most breakevens on these cattle are over 85.00. However, some optimists believe that unusually large feedlot placements over the past few months, due to the dry winter across the Plains, will be offset by extremely tight supplies of feeders available this spring. The size of the graze-out wheat runs will tell the tale as most pastures are empty and the hot-wire has already been rolled up. However, there are a few spots off the main highway, like northwestern Oklahoma, where cattle continue to enjoy graze-out wheat.
----------------------------------
From Cattlenetwork:
"Beef exports in January were up 83% from 12 months earlier, but down 59.1% from January 2003, before BSE in North America.
The first month of 2006 saw a 20% increase in beef imports into the U.S. Much of the increase in our beef imports was from Australia. For some reason beef imports from Australia were quite small in January of 2005.
Our imports of feeder cattle from Mexico in January were up 24.7% from 12 months earlier. Our total live cattle imports in January were up 137.8% from 12 months earlier. Remember, the border to live cattle imports did not open until sometime in July last year."
