Heavier feeder steer prices are following last year’s trend very closely and could peak seasonally any time within the next few weeks.
USDA-Agricultural Marketing Service data compiled by the Livestock Marketing Information Center shows prices for 700- to 800-pound Southern Plains medium and large No. 1 feeder steers to be moving upward from this year’s low of $136.68 per cwt the third week of May.
Last week, those same steers were bringing an average of $162.25 per cwt, the AMS data showed.
Actually, feeder steer prices are running on borrowed time. The 2012-2016 average for those same medium and large steers peaks around the second week of August.
However, last year, they peaked around the second week of November at $163.56 per cwt.
LIGHTER WEIGHTS ALSO FOLLOW 2017 TREND
And it isn’t just the heavier-weight feeder steers that are following last year’s trend. Lighter-weight steer prices also are running very close to last year. A case even could be made that they have begun a late-year surge earlier than last year.
Typically, prices for the lighter-weight calves are more volatile and unpredictable than their heavier-weight cousins. The 2012-2016 average is highly variable but generally bottoms for the year around Oct. 1.
Last year, medium and large No. 1 Southern Plains steer calves weighing 400 to 500 pounds showed their lowest price the first week of January at $164.56 per cwt and rose from there to a peak at $194.94 the first week of May, according to AMS data.
A secondary price peak came the first week of December at $192.45 per cwt.
Discounting the January low price last year, the fall low last year came the first week of October at $176.02 per cwt.
This year, the annual low came the last week of May at $176.14 per cwt, but prices since then have struggled to get much above the 2017 trend. That is until two weeks ago.
A minor breakout occurred the last week of September when the weekly average price for the weight steer calves bumped up to $185.43 per cwt, compared with $180.29 in the same week of 2017. The trend continued last week with an average weekly mark of $186.40 per cwt, versus $176.02 the year before.
It’s hard to make a case for two weeks being the beginning of a trend, but if it turns out to be such, steer calf prices in the Southern Plains could continue rising into late November or early December.
But the weather may have something to say about that. Rains in the Plains could aid winter wheat planting and thus more demand for calves to put on wheat for most of the winter.
But if it stays too wet to plant, demand for these calves could drop.
CATTLE, BEEF RECAP
No fed cattle sold last Wednesday on the Livestock Exchange Video Auction, compared with 280 that traded six weeks previous at $109.50 per cwt.
The USDA’s five-area accumulated cattle sales reported a sale at $110.50 per cwt, compared with $110 to $112 per cwt on a live basis last week, steady to up $1 from the previous week. Dressed sales last week were at $174 to $175, up $1.
The USDA choice cutout Tuesday was down $0.36 per cwt at $202.85, while select was up $0.91 at $192.72. The choice/select spread narrowed to $10.13 from $11.40 with 102 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Monday, was $158.45 per cwt, up $0.30. This compares with Tuesday’s Oct settlement of $156.95, down $0.72.