Cattle Slaughter Tracks Seasonal At Lower Rate

Federally inspected cattle slaughter rose last week, following a seasonal pattern, but it remains well below the previous five-year average and last year.

Weekly slaughter this year has never been above the average and has only eclipsed last year on two occasions, the first week of January and the last week of February.  What’s more, the separation between this year’s total slaughter and those of last year and the previous five-year average is widening slowly, and the differences have become more pronounced since early July.

Last week’s estimated slaughter was 565,000 head, up 3,000 head, or 0.54%, from 562,000 the previous week.  However, it was 54,300 head, or 8.77%, below the 619,300 head slaughtered a year ago and 83,340 head, or 12.9%, below the average of 648,340 head.

Since the two crossings of last year’s slaughter pace, the lines have not met.




As reported earlier, a decline in total cow slaughter is the main culprit in the decline in total slaughter.  Weekly cow slaughter last was above the five-year average during the last week of March.  It showed a steady decline in April and has remained well below last year and the previous five-year average ever since.

Last week, total cow slaughter was reported at 99,333 head, 17,000, or 14.6%, below the 116,300 of a year ago.  It also was 29,467, or 22.9%, below the five-year average.

Herd rebuilding has begun via a less-intensive culling of cows.

Heifer slaughter also has declined since the first week of July, but weekly gyrations that pushed it close to last year the second week of September make it less obvious.  Through June, heifer slaughter always was below the average, but sometimes touched or crossed above the year-ago line on a Livestock Marketing Information Center graph.

However, the post-Independence-Day rise in heifer slaughter fell far short of normal, and the trend has continued.

If heifer slaughter follows the average, it will rise into early November and be followed by a significant decline into the end of the year.

If it follows last year, heifer slaughter will decline unevenly into late November with a bump in early December before an end-of-year decline into the holidays.




But if cow and heifer slaughter are down, showing signs of herd rebuilding, steer slaughter is only slightly below a year ago, reflecting the decreased size of the US herd.  Steer slaughter has been below a year ago in most weeks, but has remained below the five-year average all year.

Still, a chart of steer slaughter shows less of a divergence in steer slaughter from a year ago and the average than does cow or heifer slaughter.




Wholesale beef prices Monday were up only slightly from Friday, supported by only light offerings from packers.  Demand from retail and restaurant buyers was said to be moderate at best.

The modest demand means meat buyers got it right when they planned the weekend retail movement.  It shows they have little fill-in buying to do.

However, packers also got it right when by offering less product.  The result was an uneventful day of beef trading with only 87 loads of fabricated product sold into the spot market.

The USDA reported its choice cutout value up $0.68 per cwt at $249.84 and select up $0.39 at $235.17.  The choice/select spread widened to $14.67 from $14.38

The CME Feeder Cattle Index for the seven days ended Friday was off $1.48 to $241.84 as it closes in on the Oct futures price before expiration.  Oct settled Monday at $240.75, up $2.30.