Market Reports

“This has been one of the few years in history when every segment of the industry made money. And that doesn’t happen very often,” said Duane Lenz, general manager of CattleFax, at the California Cattleman’s Association annual convention in Reno, Nevada. Generally, one segment of the cattle market makes a profit at the expense of another segment.

The latest weekly carcass weight data for the week ending on Nov. 18 showed steer carcass weights at 902 pounds for the third consecutive week. This is likely the seasonal peak in carcass weights and is up 70 pounds from the seasonal low of 832 pounds in early May.

The 2017 U.S. commercial beef production forecast was lowered slightly from last month at the time of this writing to 26.6 billion pounds. Beef production in 2018 is projected up 20 million pounds from the previous month to 27.3 billion pounds on heavier fed cattle weights during the year.

Current cattle markets can be thought of as a series of bad news-good news stories. The bad news is that cash fed cattle prices pulled back last week from the highs at the end of the week before. The good news is that the jump up to $124 per hundredweight (cwt) live fed cattle prices was not expected and the current level in the $120-121 per cwt range is at or above most expectations for fed prices at this point.

Drought conditions in the Northern Plains and Hurricanes Harvey and Irma have likely affected regional U.S. cattle production. While much of the effects from the drought in the Northern Plains has likely already played out, it is too early to estimate the impacts of the two hurricanes.

August trade data showed exports continued at a double-digit pace, increasing 15 percent over August 2016. This marks the third month in a row of double digit export increases and extends the year-to-date lead to 15 percent over last year.