Calf and feeder prices moved lower last week. Extreme heat kept some cattle and buyers out of the market. Meanwhile, nearby feeder-cattle futures moved $2 to almost $3 lower in the past two weeks in response to higher grain costs and the anemic performance of the overall economy.

As for the heat (see "Record Heat And La Niña"), analysts with USDA's Agricultural Marketing Service (AMS) explained Friday: “It appears the heat has finally gotten to the feeder and stocker-cattle market with near record-high temps plaguing much of the major cattle production areas. Livestock movement during the daylight hours has been extremely difficult during this last stretch of the mid-summer heat wave with weight and flesh conditions hard to maintain, not to mention an increased occurrence of death loss. This affects both buyers and sellers as both get to share in the risks of movement, causing limited receipts and sales transactions which are expected to increase considerably if the heat subsides like forecasters expect it to in the coming weeks.”

In round numbers, feeder cattle sold steady to $2 lower with light seasonal movement, while calves – mostly the un-weaned variety – traded weak to $4 lower, according to AMS.

As for increasing feed costs, the rally in grain prices – led by wheat – and expectation for higher demand are ratcheting up breakevens.

The ace in the hole continues to be cattle numbers. Beef-cow numbers declined 2% to 31.7 million head compared to a year earlier, according to the USDA July 1 cattle inventory. The number of beef heifers retained as replacements is down a little more than 2%.

Plus, even as domestic beef demand struggles through the nation’s limping economy, beef export demand continues to grow.

According to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF), June beef exports were 25% more than year-ago volumes, totaling 96,578 metric tons (212.9 million lbs.). Meanwhile, export value in June was up 37% to $377.6 million.

For the year, Livestock Marketing Information Center (LMIC) analysts said last week, “Year-to-year gains in recent U.S. beef exports are expected to continue for the balance of 2010. Current LMIC forecasts for calendar year 2010 are for about a 10% increase in U.S. beef exports over last year.”

Future beef exports to Mexico received a boost last week as Mexico eliminated anti-dumping duties against beef (3¢-29¢/lb.) after about 10 years of political wrangling.

All told, Tim Petry, North Dakota State University ag economist, said last week, “Feeder-calf prices likely will be 10-15% higher this fall than the depressed levels of the last two years unless corn prices continue to skyrocket.”

Petry cautions, though, that the economy still is struggling. "This is affecting high-quality beef demand at the retail level and fed-cattle prices. Competing meat supplies also will be important to cattle prices, with boiler production starting to ramp up again," he says.

The summary below reflects the week ended Aug. 13 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.
TX 24,700 $115.97 $113.01 $104.30 $112.26 $105.13 $102.00
OK 23,300 $123.15 $117.40 $115.18 $115.79 $112.66 $107.48
AL 18,900 $115.54 $109.14 $101.32 $106.54 $100.01 $95.55
MO 16,300 $126.42 $121.65 $115.73 $115.61 $111.85 $111.42
KY* 15,600 $117.17 $114.72 $114.45 $109.10 $105.47 $105.77
KS* 11,500 $130.57 $123.98 $117.59 $117.91 $114.80 $111.15
AR 9,700 $118.19 $115.34 $111.434 $109.02 $104.88 $103.454
Dakotas 9,600
SD
ND

**
$126.90

$126.55
$122.92

$121.21
$117.67

**
$114.382

$116.98
$113.42

$113.27
$110.24
FL** 8,200 $103-120 $101-115 $99-1036 $97-112 $93-107 $92-97
IA 8,100 $134.27 $127.25 $120.51 $121.95 $115.00 $113.84
MS* 8,000 $105-1151 $102-1143 $99-1065 $97-1081 $95-1023 $88-985
LA* 7,500 $110-122 $105-117 $102-1074 $95-108 $99-105 $92-964
Carolinas* 6,500 $100-116 $96-112 $95.50-105 $92-108 $89-101.50 $85-94
TN* 6,300 $113.36 $109.75 $105.22 $105.03 $99.39 $93.53
GA*** 6,100 $104-117.75 $98-114 $90-106 $95-108 $90-104 $90-94
VA 6,100 $120.99 $119.45 $120.18 $108.66 $101.84 $95.24
NE 5,700 $137.88 $129.88 $119.20 $122.91 $118.36 $112.43
NM 3,100 $121.82 $115.17 $102.85 $108.23 $100.874 **
WY 2,500 ** ** $110.83 ** ** $108.66
CO 1,300 ** ** $117.59 ** ** $112.26
MT 1,200 $123.612 $121.33 $111.16 $104.48 $107.95 $105.50

* 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.