Steer slaughter so far this year is running below year ago levels, despite quarterly feedlot inventories being larger than last year, said Oklahoma State University Extension Livestock Marketing Specialist Derrell Peel in a market analysis to Extension agents.
For the year to date, steer slaughter is about 1% below last year but in the last four weeks has averaged very close to year-ago levels, Peel said. Steer slaughter has averaged 51.6% of total cattle slaughter so far this year, down from 52.9% in 2017.
As heifer and cow slaughter return to normal, steer slaughter will move closer to the long-term average of 50.6% of total slaughter, Peel said.
Steer carcass weights have averaged about four pounds above year-earlier levels this year, Peel said. Weekly steer carcass weights may have peaked seasonally a bit early the first week of October at 903 pounds.
However, while weights averaged 895 pounds in the latest weekly data, they could jump to a higher seasonal peak yet this month.
HEIFER SLAUGHTER ABOVE 2017
Heifer slaughter this year is averaging about 7% above 2017 with smaller year-over-year increases in recent weeks, Peel said. In the last four weeks, heifer slaughter has averaged just 1.5% above year-earlier levels.
Heifer slaughter thus far in 2018 has averaged 27.8% of total cattle slaughter, up from 27.2% in 2017, Peel said, but as heifer retention continues to slow, heifer slaughter will approach the long-term average just under 30%.
Heifer carcass weights have averaged about eight pounds above last year for the year to date, he said. Like steers, heifer carcass weights may have peaked seasonally at 835 pounds the first week of October. In the latest weekly data, weights were 828 pounds, although they could rise to a more typical seasonal peak in November.
Heifer carcass weights continue to increase relative to steers. The latest 12-month moving average heifer carcass weight as a percent of steer carcass weight was another record at 92.7%.
COW KILLS UP
Total cow slaughter is up 7.3% year to date with the beef cow kill up 10.5% as beef cow culling returns to long-term average levels, Peel said.
Dairy cow slaughter has moved higher as months of poor dairy economics pushed producers to reduce cow numbers, he said. Dairy cow slaughter is up 4.3% year over year.
Cow slaughter is averaging 18.9% of total cattle slaughter so far this year, compared with a long-term average of 17.7%, Peel said.
Cow carcass weights are averaging nearly five pounds heavier than last year with more dairy cows adding to total cow carcass weights.
Total cattle slaughter is up 2.7% over last year, Peel said. Increased slaughter, combined with an average of 2.3-pound increase in carcass weights, contributed to a 2.7% year-to-date increase in beef production from last year.
Total 2018 beef production was projected to be 27.0 billion pounds, a new record, Peel said.
Beef production was forecast to grow to another record of 27.5 billion pounds in 2019.
CATTLE, BEEF RECAP
Cash cattle last week traded at $112 to mostly $114 to $115 per cwt on a live basis and at $178 to mostly $179 to $180 on a dressed basis, both steady to down $1.
The USDA choice cutout Tuesday was down $1.47 per cwt at $214.08, while select was down $1.41 at $198.98. The choice/select spread narrowed to $15.10 from $15.16 with 97 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Monday, was $149.89 per cwt, down $0.70. This compares with Tuesday’s Nov settlement of $148.97, up $0.60.