Fed cattle prices continued to move higher over the last five weeks, said the Livestock Marketing Information Center in its newsletter In The Cattle Markets.
The rise in cattle prices showcases the continued strong consumer demand for beef, which translates into strong demand for fed cattle to feed the processing plants, said a market analyst.
USDA DATA REVEALS THE STRENGTH
Last week’s USDA five-area weighted average fed steer price was $224.80 per cwt, a record at $38.86 per cwt, or 20.9%, more than $185.94 in the same week a year ago and up $91.98, or 69.6%, more than the 2019-2023 average, the LMIC said.
The fed steer price started the year at $198.93 per cwt, which marks an +11%, or $22.04 per cwt, increase in a little more than four months, the LMIC said. Since the start of the year, the fed steer price has been less than $200 per cwt just three times: the first week of the year at $198.93, the last week of February at $199.64, and the first week of March at $197.65.
The USDA’s five-area fed steer price now has been higher than $220 per cwt for two straight weeks.
SEASONALS TRACK STEADY
The seasonal index for fed steer prices indicates that prices typically track steady through May, the LMIC said, followed by a gradual move lower through September. They then trend higher through the fourth quarter of the year.
This year, seasonal fed steer prices are tracking slightly higher through April and into the first week of May, the LMIC pointed out.
Seasonally, the pattern would signal that prices may move lower as the Memorial Day holiday approaches, the LMIC said.
Last year, fed steer prices peaked at $197.09 per cwt in the first week of July, the LMIC said. If prices follow a similar pattern to last year, the peak fed steer price for the year may still be a couple of months away.
CHOICE BEEF HITS RECORD
Last week’s boxed beef cutout value (choice 600- to 900-pound carcass, negotiated) reached $345.65 per cwt, a high so far for the year and 16.5%, or $48.87 per cwt, more than $296.78 in the same week last year, the LMIC said.
Seasonally, the boxed beef cutout value peaks around Memorial Day, the LMIC said. Last year, the boxed beef cutout value peaked at $329.96 per cwt during the first week July.
But, if the boxed beef cutout value follows a similar seasonal pattern to last year, the peak price may occur closer to the Independence Day holiday, the LMIC said.
CTTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $220.35 per cwt to $226.92, compared with last week’s range of $216.84 to $222.23 per cwt. FOB dressed steers, and heifers went for $342.45 per cwt to $357.95, compared with $336.28 to $357.17.
The USDA choice cutout Wednesday was down $0.74 per cwt at $349.36 while select was up $1.38 at $335.85. The choice/select spread narrowed to $13.51 from $15.63 with 106 loads of fabricated product and 23 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef was $377.47 per cwt, and 50% beef was $123.73.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.15 to $1.25 a bushel over the Jul corn contract, which settled at $4.45 1/2, up $0.03.
The CME Feeder Cattle Index for the seven days ended Tuesday was $302.41 per cwt, up $0.01. This compares with Wednesday’s May contract settlement of $299.57, down $3.25.