Lower Fed Cattle Prices, Higher Corn Prices Hammer Feeder Futures

   Year-over-year beef imports were up a whopping 49.2 percent in October. The big increase was due largely to more beef coming from Australia. During the first 10 months of 2014 beef imports are up 25.3 percent. U.S. beef exports were down 3.4 percent in October compared to 12 months earlier with a decline in shipments to Canada and Mexico, but increases in exports to Japan and South Korea. January-October beef exports were up 0.5 percent. In October, 10.5 percent of U.S. beef production was exported and imports equaled 12.6 percent of production.
   There were few significant changes in this month’s USDA price forecasts (WASDE). USDA held steady their forecast for the marketing year average price of corn at between $3.20 and $3.80 per bushel. USDA increased their prediction of 2014 fed cattle by 88 cents to $155.29/cwt live and they raised their forecast for 2015 average slaughter steer price by $6 to between $160 and $172/cwt.
   Boxed beef prices declined this week. This morning the boxed beef cutout value for choice carcasses was $245.63/cwt, down $8.24 from the previous Friday, but up $47.68 from a year ago. The select carcass cutout is $234.93/cwt, down $2.85 from last week, but up $47.80 from a year ago.
   Fed cattle prices were lower again this week on modest sales volume. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $163.11/cwt, down $3.50 from last week's average, but up $32.95 from a year ago. The 5 area average dressed price for steers was $256.55/cwt, down $7.42 for the week.
   This week’s cattle slaughter totaled 566,000 head, up 0.7 percent from the week before week, but down 6.9 percent from the same week last year. The average steer dressed weight for the week ending on November 29 was 901 pounds, unchanged from the week before, but up 26 pounds compared to the same week last year.
   Feeder cattle prices at this week’s Oklahoma City auction were steady to $2 lower on feeder steers and $3 to $6 higher on stocker steers compared to the week before. This week’s prices for medium and large frame #1 steers by weight were: 400-450# $347-$393, 450-500# $320-$345, 500-550# $294-$319, 550-600# $276-$297, 600-650# $250-$280.50, 650-700# $234-$262, 700-750# $235-$248, 750-800# $225-$236.75, 800-900# $217.50-$233.50, and 900-1000# $210-$214/cwt.
   The December live cattle futures contract settled at $162.05, down $2.40 for the week. February cattle settled at $162.17/cwt, down $2.70 from the previous Friday. The April contract closed at $161.40/cwt with a loss of $2.90 for the week.
   Lower fed cattle prices and higher corn prices hammered feeder cattle futures this week. The January feeder cattle contract ended the week at $225.60/cwt, down $9.27 for the week. March feeders closed at $221.25/cwt, down $9.97 compared to last Friday. April feeders ended the week $9.82 lower at $230.92/cwt. ∆
   DR. RON PLAIN AND DR. SCOTT BROWN: Agricultural Economists, University of Missouri
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