The feeder cattle marketing season has ended in the Northern Plains and many livestock auction markets are starting reduced summer schedules. However, a number of Northern Plains auctions are reporting higher-than-expected receipts of beef cows, according to Tim Petry, North Dakota State University Extension livestock marketing economist.
“For example, in the last week of May, a central North Dakota auction reported selling several hundred beef cows when only about 100 were expected,” Petry says. “This surprised both the market and the cow buyers.”
In talking with beef producers, Petry found two likely reasons for the increased marketing. “First of all, there were significantly more calf deaths this spring in parts of North Dakota, South Dakota and Montana due to record snowfall, several severe spring snow storms and unprecedented flooding. And calf deaths are continuing as problems with scours and pneumonia, a result of weather stress, persist. So, cows that have lost calves are being sold. In addition, producers indicated they wanted to market cows before the Cooperatives Working Together (CWT) dairy cow buyout program started.”
Beef cow producers are afraid the increased dairy cow marketing may depress cow prices. The CWT buyout accepted 102,898 cows for the program. It’s anticipated that from 7,000 to 10,000 head of cows will be marketed each week from late May into August. Details of the buyout are available at www.cwt.coop.
The latest cow slaughter information reported by USDA-AMS is for the week ended May 23. USDA reported 52,600 dairy cows and 65,100 beef cows slaughtered during the week. This compares to 45,400 dairy cows and 75,500 beef cows slaughtered during the same week in 2008.
“So, dairy cow slaughter was up 7,200 from the previous year. However, beef cow slaughter was down 10,400 head, more than offsetting the increased dairy cow slaughter. So, even though more beef cows are coming to market in the Northern Plains, fewer are being sold in other areas of the U.S. than last year,” Petry says.
“The main reasons for lower beef cow slaughter are that slaughter was relatively high last year, so heavy culling has already taken place,” Petry adds. “And, pasture and range conditions are better than last year. This year's trend of higher dairy cow and lower beef cow slaughter should continue throughout the summer. So, the impact of both on cow prices should be somewhat offsetting.”
After increasing seasonally for several months, cow prices declined the last two weeks as both dairy and beef cow slaughter increased and the beef market struggled. The rate of the last two week's decline isn’t expected to continue, but prices are not likely to reach last summer's record levels either, he says.
“A trading range in prices near levels of the last few weeks is likely during the summer, unless pasture and range conditions deteriorate and beef cow marketing increases. Seasonal weakness can be expected again in the fall when normal beef cow culling occurs,” Petry says.
-- Livestock Marketing Information Center “In the Cattle Markets"