Some Feeder Cattle Prices Slip With Fed Cattle

As fed cattle prices in the Plains slip away from record highs, prices for several weight ranges of feeder cattle continue to mark new tops.

In general, feeder steers weighing 400 to 600 pounds are in demand by feedlots while the heavier weights, those weighing 700 to 800 pounds, fade from popularity.

USDA figures of regional feeder cattle prices compiled by the Livestock Marketing Information Center show 400- to 500-pound South Dakota steers last week averaging a record high $317 per cwt, $31.27, or 10.94%, higher than the $285.73 of two weeks earlier.  It also is $124.83, or 64.96%, higher than the $192.17 in the comparable week a year ago and $171.14, or 117.33%, above the five-year average of $145.86.

Conversely, prices for 700- to 800-pound feeder steers in South Dakota during the latest reporting week are off their recent record highs, although they remain well above last year and the five-year average.  USDA data show these steers most recently bringing an average of $238.43 per cwt, almost even with the previous week’s $238.53, but $11.69, or 4.67%, below the record weekly high of $250.12 that was set two weeks earlier.

However, that $238.43 price still is $78.25, or 48.85%, above the $160.18 of a year earlier and $117.00, or 96.35% above the five-year average.

A similar trend holds true in Washington and in the Southern Plains, although it does not follow in the Georgia market where even the heavier weight feeder steers continue to bring record—high prices.




Sources say lighter-weight feeder cattle are more popular among feeders because the price of corn has declined after years of drought-ravaged yields, and wheat planting is near.

Just as it pays to keep cattle on feed a little longer to add those extra pounds, it also pays to put slightly lighter cattle in the lot for extra gain on corn.  Many cattlemen also are seeking calves to graze their wheat pasture.

That’s a reversal of strategy from last year and even through the spring when record-high corn prices made it more profitable to keep cattle on grass for as long as possible.  Heavier calves were more popular for feedlot placements because it was cheaper to put on grass weight than feedlot weight.

Sources say competition for the lighter calves for grazing is heating up.  Rainier weather this year in the Plains rejuvenated grass pastures, some of which have not been grazed.  Add to this the prospect of abundant wheat pasture from well-watered fields, and prices go up.




Prices for fed steers in the Plains last week were $160 per cwt on a live basis, and with near-record prices for 700- to 800-pound feeder steers, the LMIC calculates that cattle feeders can still might turn a $13-per-cwt profit.

The LMIC estimated breakeven prices for cattle place on feed in August to be about $148 per cwt, increasing to around $164 for October placements.

Market analysts expect fed cattle prices to remain strong or even increase in the fourth quarter as supplies tighten and holiday beef demand heats up.

However, feedlot margins may be squeezed as corn prices bottom and feeder cattle prices keep rising.

Boxed-beef prices were lower again Monday with the choice cutout at $259.44 per cwt, down $1.01.  Select was down $1.38 at $251.62.  The choice/select spread continues to widen seasonally, and is now $7.83, and there were 108 loads of fabricated product sold into the spot market.