Outside markets pressured cash and futures cattle prices significantly last week as the world continued fretting over the European debt situation.

“Sharp losses on the Chicago Mercantile Exchange (CME) Live and Feeder Cattle contracts pressured cash feeder prices, and the ensuing lower direct slaughter cattle trade kept feedlot replacements from rebounding,” said analysts with the Agricultural Marketing Service (AMS) Friday. “In eight trading sessions since May 12, the June Live Cattle contracts lost $5.45 as speculating investment funds sold their long positions on the commodity market to offset losses on the collapsing U.S. stock market and other publicly traded investments. Suddenly, the CME cattle contracts were heavy on the short side after cattle feeders have aggressively short-hedged lofty price levels and there are very few long buyers to hold the market, despite rock-solid beef cattle fundamentals.”

• Feeder steers and heifers trended $1-$4 lower, with stocker cattle and calves trading steady to $5 lower.

• Fed cattle traded generally $2.50-$4.50 lower on a live basis; $5-$8 lower dressed.

• Feeder futures dropped an average of $2.41 for the first six months, compared to a week earlier; Live Cattle down an average of $1.67 for the first six months.

“When the smoke cleared after daily trades from the previous Friday through Thursday, the packers saved a few dollars per hundredweight, while most feedlots enjoyed a huge basis premium and continued to pull lightweight show lists forward, which are now about three weeks ahead of schedule, after being that far behind just a few months ago,” say AMS analysts.

Judging by Friday’s "Cattle on Feed" report, cattle are being pulled forward, period. April placements were 2% higher than in April last year as feedlots exploited recent profitability – cash to cash. Total cattle on feed numbers were 3% higher than a year earlier; marketings in April were 1% below a year earlier.

In the most recent "Livestock, Dairy and Poultry Outlook," analysts with the USDA Economic Research Service (ERS) explain, “The large proportion of lighter-weight feeder cattle placements reported in the April Cattle on Feed report has raised the question of whether there are heavier cattle still outside feedlots – perhaps on graze-out wheat – and, if so, when will they be placed on feed?”

At the same time, cow slaughter continues at a steamy pace.

“Relatively high levels of federally inspected cow slaughter as a share of January 1, 2010 cow inventories, especially beef cows in the Midwest, Southern Plains and Southwest, have continued into the second quarter of 2010, despite current calf price levels, profit margins, and pasture conditions,” say the ERS analysts. “An explanation is that cow-calf producers may be marketing cull cows as the decision to cull them is made, thus capturing the high prices, rather than waiting until later in the year to sell them as a group and risking price declines. Imported Canadian cows for slaughter are also contributing to the high cow slaughter numbers, but do not explain the whole picture.”

The summary below reflects the week ended May 21 for Medium and Large 1 – 500- to 550-lb., 600- to 650-lb. (calves), and 700- to 750-lb. feeder heifers and steers (unless otherwise noted). The list is arranged in descending order by auction volume and represents sales reported in the weekly USDA National Feeder and Stocker Cattle Summary:

Summary Table
State Volume Steers Heifers
Calf Weight 500-550 lbs. 600-650 lbs. 700-750 lbs. 500-550 lbs. 600-650 lbs. 700-750 lbs.
OK 37,700 $126.48 $121.89 $116.06 $115.24 $112.32 $104.34
MO 28,000 $129.88 $124.43 $117.52 $116.72 $115.47 $107.94
TX 22,000 $116.04 $111.90 $104.25 $108.33 $104.06 $103.40
KY* 17,800 $124.75 $119.36 $108.45 $110.77 $104.86 $103.84
SD 12,800 $134.90 $127.14 $118.95 $124.63 $116.63 $109.95
AL 11,000 $119.61 $114.35 $105.63 $108.03 $101.88 $88.147
IA 9,900 $134.41 $123.06 $118.33 $123.53 $115.96 $111.54
GA*(***) 8,700 $102-119 $96-115 $89-103 $95-114 $88-106 $88-95
AR 8,200 $125.00 $114.19 $110.154 $111.22 $106.16 $102.154
KS 8,000 $127.742 $118.89 $111.766 $116.82 $110.86 $105.54
Carolinas* 7,700 $104-127.50 $101-115 $95-104 $92-111.50 $85-110 $84-93
TN* 6,500 $117.86 $110.89 $103.63 $107.89 $101.40 $93-66
FL* 6,400 $99-122 $98-105 $101-104 $95-108 $91-108 $86-90
MS* 6,200 $105-1181 $110-1133 $95-1045 $98-1101 $95-1043 $87-935
LA* 5,000 $108-122 $99-114 $98-1124 $100-112 $90-107 $89-1024
NM 4,900 $124.43 $112.91 $105.32 $112.57 $100.47 $93.757
NE 4,400 $139.87 $132.96 $127.81 $128.78 $120.45 109.27
MT 3,600 ** ** ** $120.58 $118.01 $115.384
VA 3,300 $120.63 $116.73 $107.18 $106.61 $102.16 $101.664
CO 2,500 $141.40 $130.114 $116.34 $102.832 $118.03 $104.74
WA 2,100 $131.61 $107.49 $107.09 $103.82 $101.63 $101.274
WY 1,400 ** ** ** $118.95 ** **

* Plus #2
** None reported of the same quality at this weight or near weight
(***) Steers and bulls
(?) As reported, but questionable
NDNo Description
1500-600 lbs.
2550-600 lbs.
3600-700 lbs.
4650-700 lbs.
5700-800 lbs.
6750-800 lbs.
7800-850 lbs.
8850-900 lbs.