Cattle prices are under pressure despite relatively strong beef market fundamentals. Seasonally, cutout values have held up relatively well, particularly prices for lean trimmings. Choice middle meat cuts have done well, with steaks finding a place alongside burgers on summer grills. In the export market, U.S. beef is starting to look more attractive compared to supplies from Australia, which should bode well for Asian demand.
On the feed side of the equation, USDA’s July World Ag Supply and Demand Estimates (WASDE) report was less bearish for corn marketers. Higher planted acres are being offset by increased demand, particularly exports. So, while projected new-crop corn ending stocks rose, the increase was below the average trade forecast.
Although much of the corn crop had already passed the pollination phase, late-season weather helps determine kernel fill, and there is some concern over extreme heat across the U.S. Plains and Western Corn Belt.
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Cutter cow prices projected
National average third-quarter 2016 cutter cow prices are forecast in the $68 to $72 per hundredweight range, according to the latest USDA Livestock, Dairy and Poultry report, released July 18.
Cutter cow average prices ($ per hundredweight):
- 2013 annual: $77.56
- 2014 annual: $102.04
- 2015 annual: $99.56
- 1Q 2016: $73.50
- 2Q 2016: $75.87
Projected prices ($ per hundredweight):
- 3Q 2016: $68-$72
- 4Q 2016: $69-$77
- 2016 annual: $71-$75
- 1Q 2017: $70-$80
- 2Q 2017: $80-$90
- 2017 annual: $79-$89
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Dave Natzke
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