Steve Kay's Friday Market Update

Dec. 19 -- The cash live cattle trade Friday morning was largely inactive. USDA’s mandatory price reporting (MPR) service reported that Nebraska sold 1545 head, mostly at $159.89 per cwt live, for a weekly total of 14,534 head. Iowa-southern Minnesota sold 1020 head at $251.00 dressed for a weekly total of 11,934 head. Kansas sold no cattle for a weekly total of 9245 head. Texas sold no cattle for a weekly total of 1414 head. The MPR weekly totals include negotiated cash and grid sales.

Live cattle futures closed higher. December closed up 205 points at $160.75 (versus $162.05 last Friday), February closed up 157 points at $160.10, April closed up 147 points at $159.67, June closed up 205 points at $152.50, August closed up 255 points at $150.80 and October closed up 260 points at $152.25. Feeder cattle futures closed up 307 to 420 points.

The week’s cattle slaughter was an estimated 552,000 head (versus 616,660 head last year), with Friday’s kill 106,000 head and Saturday’s kill 7000 head. Year to date FI slaughter is an estimated 28.961M head, down 7.4% or 2.320M head from 2013’s 31.281M head. Hog slaughter year to date is down 5.0% or 5.468M head on last year.

Boxed beef cutout values were weak to lower on light demand and light to moderate offerings. The Choice cutout declined $3.38 per cwt from the day before to $238.57 per cwt (versus $245.03 last Friday) and the Select cutout declined $0.44 to $229.88 (versus $234.10 last Friday). The Choice-Select price spread was $8.69 versus $10.93 the Friday before. The reported spot boxed beef trade for the week was 518 loads of fabricated cuts, down 18.4% from the 635 loads of fabricated cuts last week.

Packer margins for the week were negative by $115.82 per head, compared to a negative $106.38 the week before, according to


USDA released its monthly Cattle on Feed (COF) report Friday afternoon. The numbers for U.S. feedlots 1000 head or larger were:

  • COF 1 December 1: 10.876M head, 101.4% of a year ago
  • Placed in November: 1.792M head, 96.0%
  • Marketed in November: 1.475M head, 88.9%

Analysts regarded the report as neutral to slightly bearish because of lower than expected November marketings. They were 1.0% lower than analysts’ average forecast. November included one less slaughter day than last year, so marketings were down 6.5% on last year. Placements were 0.5% lower than forecast. So the Dec 1 COF total was 0.1% above the average forecast. This was the second COF total in a row above a year ago (by 152,000 head).

The trend of feeding more cattle up north continued. Texas edged Nebraska for the state with the most cattle on feed, 2.560M head, versus 2.550M head in Nebraska. Kansas was third with 2.100M head. Four states, Arizona, California, Colorado and Oklahoma, had fewer cattle on feed than a year ago. Four states, Idaho, Nebraska, Oklahoma and Washington, placed more cattle than a year ago.

The weight breakdown showed the only year-on-year increase was in the two heaviest categories. The under 700 lb category saw a 9.2% or 100,000 head decline. The 700-799 lb category saw a 2.8% or 10,000 head increase and the 800 lbs and over category saw a 3.5% or 15,000 head increase.

No state marketed more cattle in November than last year. Kansas marketings were down 17%, Texas marketings were down 10% and Nebraska marketings were down 7%. It again marketed more cattle than Texas in the month.

To see a PDF of the COF report click here. To see a text version of the COF report, click here.

My best to you and your family for a wonderful Christmas,

Steve Kay



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