Page 8 - MWC 3-9-2023s

The Midwest Cattleman · March 9, 2023 · P8

MARKET REPORT

Live Cattle Feeder Cattle Daily

Live Cattle: Feeder Cattle:
Traders are questioning how much further for this cattle mar- There has been a change in beef cow culling recently. The past
ket rally. Part of this last leg of higher prices was due to our recent four weeks have seen slaughter rates -11% from last year. Now,
three weeks of lowered cattle slaughter. Weight gains have been set let’s point out we’re being compared against a huge liquidation
back but the trade wonders if that will soon change. Those animals even. Last year’s Q1 cow cull was the largest in 36 years. The 2022
are still out there and warmer weather is ahead. Additionally, we’ll cull was also a large 17% over 2021. We’re still officially in liqui-
see if warmer weather brings any change to our weight problem dation. But depending on calf prices this fall, and with a return of
with steers -1.6% from last year and heifers -2.5%. There is an- moisture, it may be a discussion point ahead. We’re already set for
Feeder Cattle: All you have to do is look at the corn market for a reason for the
Live Cattle: My thoughts center around this market stabilizing now. I’ve been
other looming question that we are not sure about. Will seasonals pull-back in feeders. If I owned a feedlot I’d be nervous to say the least. I do feel
placing a bullish tilt to this market for some time now. I may need to temporarily calf crop declines for three years ahead. But if we do start expan-
work this year? The current February 24 peak for June live cattle sion in 2024 perhaps, this tightens up beef production even more
place this on “hold” for a while. The higher placements the last three months will
the feeder market has overdone it to the downside and it will be tough to break it
further. The early corn harvest has most feeder buyers in the field and I don’t think
futures is quite close to the 15 year average peak on February 19. as those females are held from the feedlot.
have a negative impact on prices yet, so like they say, “All good things come to those
who wait”. I see production numbers staying over last years’ levels until at the
The low for that contract would then show on May 31. they’ve really had time to concentrate on buying feeders. Let’em get caught up a
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
If this market is ready to peak out we’re looking at $154 and $155
for about a month. Two weeks ago they were 8% lower than last year. This weeks This market will rally....wait and see.
for June and August cattle. Kansas State was suggesting $154 and
report showed exports a whopping 56% lower than last year. This ain’t good. Low
imports and high exports have held this market up all summer. We’re starting to
$157 for fed cattle breakevens back on February 10 for those two
lose some of that. I just can’t pull the trigger yet on long term bullish hopes.
periods. That estimate was released when corn was priced $0.30
higher.
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 current price 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: Using December futures, we expect further pressure until a spring low is established near $5.38. After a summer rebound
going to have to kick in though in order to get it.
ultimate lows are seen at $4.29 for harvest lows. This is made assuming trend yields. That is in line with current spring and summer
Q #2
forecasts. Keep all feed purchases hand to mouth at this time.
Due to the recent break in feeders, would you be holding your fall-weaned
Q: Will lower corn prices add further support to feeder prices?
calves for a while or letting them go?
Answer: What ever happened to the easy questions? This will depend upon your weaning sched-
A: 7# steers have added $10 since the start of the year. Current prices are 19% over last year, calves 13% over. Though we can
ule and your available feed supply. I’m long term bullish the feeder market but the “reality” of
see a temporary stall in feeder prices, perhaps as fed cattle pause in this rally, we hesitate to suggest that will be the end of it for the
right now probably dictates letting them go. If you keep them for an extra 30 days, make sure you
year for feeders. There is the seasonal support for feeders, April – August. On top of that, the potential size of the corn price decline
minimize the grain in the ration. Grow them on good forage....”sell” $4.50 corn. If the fat market
ahead cannot be ignored.
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