Compared to last week, steer and heifers sold in a wide range of steady to 7.00 lower, with some instances being quoted 10.00 to 12.00 lower on some of the lighter weight steers. Grass cattle demand has subsided as ranchers are taking stock of what is going on in Chicago. CME cattle futures continued to close in the red this week and all market participants are standing up and taking notice. The erosion of equity on the balance sheet the last couple weeks is enough to make one shudder at the thought. The loss of $100 per head or more on a 750 lb steers in the matter of two weeks makes one wonder just what the heck is going on fundamentally. The May Feeder Cattle Contract has dropped 14.37 in the past two weeks after topping at 151.52 the Thursday before Good Friday. True hedgers are looking in their brokerage account, liking the basis right now and have not been afraid to take the basis money and sell the cattle all in one fell swoop. Fed cattle sellers in the Southern Plains traded on Tuesday this week 3.00 to 4.00 lower at 122.00 to 123.00 on live transactions. Northern Plains sellers sold at 200.00 dressed, 5.00 lower than last week. Willing sellers made for volume this week as this week’s tally will be the largest 5-Area volume (around 125K) since the late October 2018 when it was almost 131K. The next sixty days are when some of the best meat consumption occurs in the U.S. and we will see how much is needed to satisfy our markets both domestic and abroad. Boxed beef is lower this week and with large supplies of beef that needs to be cleaned up. For the week, the Choice cutout closed 5.78 lower at 227.36, while Select was 6.29 lower at 213.29. Cattle Slaughter under federal inspection estimated at 670K for the week, 27K more than last week and 18K more than a year ago. If the 670K is realized, it will be the largest FIS Cattle Slaughter since w/e October 29, 2011 (672,372). That was several years ago prior to many fed cattle and mature cattle plants closing. Auction volume this week included 50 percent weighing over 600 lbs and 46 percent heifers.
Source: USDA Livestock, Poultry and Grain Market News Division, St. Joseph, Mo.