Page 8 - MWC 08-5-2021s

The Midwest Cattleman · August 5, 2021 · P8

MARKET REPORT

Live Cattle Feeder Cattle Daily

Live Cattle: Feeder Cattle:
Though the lack of strength in the front end cash cattle trade is The July 23 bi-annual Cattle report reminded the trade the base
disappointing, there is evidence the coming fall and beyond period producer remains in light liquidation. Over the past three years
are set for higher pricing. The past five months of placements have beef cow numbers have been reduced 3.1%. The first half of the year
run below that of two years ago. Available feeder numbers for July saw the largest beef cow cull in 11 years. Beef heifer retention was
and August may run tight as well. End users have stopped their also lower than expected. A grouping of factors is responsible, the
minimal purchases of front end needs and are aggressively ordering most recent of which is dryness in the North. We continue to sug-
Live Cattle: My thoughts center around this market stabilizing now. I’ve been
Feeder Cattle: All you have to do is look at the corn market for a reason for the
placing a bullish tilt to this market for some time now. I may need to temporarily gest two to three years ahead of higher prices. Declines in produc-
for October and beyond procurement. pull-back in feeders. If I owned a feedlot I’d be nervous to say the least. I do feel
place this on “hold” for a while. The higher placements the last three months will tion will be seen with packing capacity increases.
Cattle feeders may feel a little wary paying up for feeders on the
the feeder market has overdone it to the downside and it will be tough to break it
Feeder numbers available for placements in the months ahead
have a negative impact on prices yet, so like they say, “All good things come to those
hope of better days ahead. In this case though, the coming breakev- further. The early corn harvest has most feeder buyers in the field and I don’t think
they’ve really had time to concentrate on buying feeders. Let’em get caught up a
who wait”. I see production numbers staying over last years’ levels until at the
ens of +$137/cwt. for Q1 finishers may warrant it. The US consumer will remain tight. Placements from August 2020 through June 2021
little and they’ll head to town.....checkbooks in hand....bulging with “corn” money.
least the end of the year. Beef shipments have been lagging last years’ levels now
will be facing tightening supplies of beef over the coming two to are 2.2% over the prior year. That is based off a 2020 calf crop 1.3%
for about a month. Two weeks ago they were 8% lower than last year. This weeks
This market will rally....wait and see.
three years and at least for first half 2022, will also be seeing small-
report showed exports a whopping 56% lower than last year. This ain’t good. Low smaller than the prior year. The next two months ahead are likely
imports and high exports have held this market up all summer. We’re starting to to run below prior year levels.
er than needed pork offerings. This is a period where calves and
feeders get the first crack at higher prices and aggressive forward
lose some of that. I just can’t pull the trigger yet on long term bullish hopes.
bookings by cattle feeders may be rewarded.
Trading commodity futures involves substantial risk of loss
and my not be suitable for all investors. The recommendations
Rich Nelson express opinions of the author. The information they contain is
Allendale Inc. Allendale Inc. obtained from sources believed reliable, but is in no way guaran-
815-578-6161 teed. The author may have positions in the markets mentioned
including at times positions contrary to the advice quoted herein.
rnelson@allendale-inc.com Opinions, market data, and
recommendations are subject to change at any time.
What Does this Report Mean to Me?
Q #1
Q: What is the outlook for corn?
What do you think the price of fats will be in April 2011
Answer: It’s hard to see the forest for the trees here, but peering through the foliage I see $105.00 fats on the horizon for April. Demand is
A: Though July temperatures in the Western Cornbelt were five degrees over normal, and most of the
going to have to kick in though in order to get it.
west ended the month with below normal rains, pollination came off just fine. The dip in temperatures at
the heart of pollination, along with good early-month rains, were the trick. That may allow a chance for
Q #2
Due to the recent break in feeders, would you be holding your fall-weaned
long term procurement, through Q1 needs, at $5.10 via the December.
calves for a while or letting them go?
Q: Are you looking at hedges on coming calf or feeder marketings?
Answer: What ever happened to the easy questions? This will depend upon your weaning sched-
ule and your available feed supply. I’m long term bullish the feeder market but the “reality” of
right now probably dictates letting them go. If you keep them for an extra 30 days, make sure you
A: Given the tightening supply narrative for fat cattle headed into first half 2021 we may see the January
minimize the grain in the ration. Grow them on good forage....”sell” $4.50 corn. If the fat market
feeder contract push to $175.
stays sluggish and corn prices don’t moderate, about the only thing you’ve got to hang your hat on
for “higher feeders” is “Hope”.
November 6th
Auction
Lunch at 11:00 a.m.

Sale at 12:30
Sale Offering
16 - 2010 Heifer Calves Jan. - May
16 - Breeding Bulls 7 to 18 months RH Standard Lad 0313
16 - Spring Calving Bred Females Solid As A Rock Sire Group
16 - Spring Calving Black Females Reynolds Herefords
Bred to Hereford Bulls
8 - Fall Calving Pairs 1071 County Road 1231
6 - Show Steer Prospects
Both Horned & Polled Offered Huntsville, MO 65259
Home: 660-277-3679 • Matt: 660-676-3788
November 5, 2010 Sale offerings on
Display 3:00 P.M.
CHB Dinner at 6:00 P.M. • Barb: 660-676-4788
Call or E-Mail for Catalog Email: reynoldscattle@cvalley.net