The following has been 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.
Cattle
Getting a clear picture of the current beef market involves delving into many factors impacting the supply chain. First, cattle supply appears larger than anticipated based on last week’s USDA Cattle on Feed report. Feedlot inventory on June first was 99.9% of last year’s total. Placements were 4.3% higher than May of 2023 and that was almost 2% higher than the average pre-report industry estimate. Futures at the Chicago Mercantile Exchange reacted to the report Monday with August closing higher given the slightly lower on-feed number, and the deferred contracts lower on the larger placements. All contracts closed higher by mid-week. Year-to-date cattle harvest is 4.4% lower than this time last year, but that tells only part of the beef supply story.
According to the Monthly Livestock Slaughter report released last week, May beef production was 0.9% higher than the same month last year even though cattle harvested was 3.2% lower. This is due to carcass weights averaging 36 pounds heavier than a year ago– a 4.4% increase. Summer heat in cattle feeding areas can impact cattle weights, but given current feed costs it is unlikely we will see a drop in live and dressed weights during the coming months.
Price-conscious shoppers seeking out lower cost alternatives coupled with the nation’s steady appetite for ground beef has caused grind to help drive cattle value. This comes at a time when non-fed cattle harvest is low, however. Beef cow harvest in May was 20% below last year with dairy cow harvest 8.7% lower. Last week’s estimated harvest total of 620,000 head was 5,000 more than the previous week and 29,000 less than last year. Cows made up 16.7% of the weekly total compared to 20.3% the same week last year. The Choice beef cutout value averaged $321.89 last week, a gain of $3.10, and showed strength to open this week.
Cattle Prices
High Choice and Prime beef breed steers and heifers sold $1-$2 higher this week, bringing $180-$193/cwt with some packages selling from $194-$200/cwt. Choice steers and heifers ranged from $170-$180/cwt. with mixed grading and those likely to grade Select bringing $152-$170/cwt. Holstein steers were steady and strong. High grading steers brought $162-$175/cwt with some fancy steers to $180/cwt. Lower grading steers brought $130-$162. Silage-fed, under-finished or heavy dairy breed steers brought $75 to $130/cwt. Dairy x Beef steers were higher bringing $135-$187/cwt.
Cows were mixed. Most of the cows brought $104-$125/cwt with some to the high $140s/cwt. Lower yielding cows brought $75-$100 with doubtful health and thin cows were bringing up to $75/cwt.
Dairy breed bull calves were fully steady from $200-$400/head with some heavier, well-managed calves selling to $740. Beef and Beef Cross calves were steady, selling to $940 with some to $1,000/head.
Hogs
Hog harvest continues above last year. Last week’s estimate of 2.419 million hogs was 39,000 more than the week prior and 51,000 more than a year ago. USDA’s Monthly Slaughter report showed harvest down slightly, but pork production of 2.28 million pounds was a record high. Live weights were a pound heavier than last May. There are reports that market hog supply is starting to back up which will increase weights further. Some packers have slowed Saturday harvest schedules and are weighing current pork inventories against harvest schedules closely.
A slowdown in food service has hurt pork demand. The pork cutout is below $100 again, averaging $98.30 last week. There is pressure on wholesale prices this week. A Quarterly Hogs and Pigs report was released late this week and next week’s WLMU will include information from the report.
Lamb
Market lamb prices seemed to be moving at a steady to higher clip early this summer, but that changed last week with the market $10 to $50/cwt lower, likely in part due to the passing of a major ethnic lamb consumption holiday on June 16. The cutout was higher, ending last week at $469.55 compared to $462.87 the previous Friday.
The weekly harvest estimate of 33,000 head was equal to both the week before and a year ago. Both May lamb and mutton production and harvest was up slightly from 2023. The average live weight of 121 pounds was unchanged compared to 2023.
