Last week saw donut-like activity in the cash fed market. Light trade occurred on Monday and Tuesday in Iowa at $193.50-195 dressed and $122-124 live. This was called clean-up trade from the previous week by Troy Vetterkind of Vetterkind Cattle Brokerage.

Beef production estimates were increased by 330 million pounds (mp) to 25.52 billion pounds (bp) for 2013. Continued poor range conditions in key cattle states pushing relatively large placements of cattle into feedlots and continued high cow slaughter were credited by USDA as the motivation behind the estimate increase.

The cash trade was put off until later last week as packers again tried to hold onto their positive margins in the face of steadily declining product values. Bids only surfaced on Wednesday at $121 live in the South Plains, which would be $3-4 lower than the cash prices of the prior week.

The cash markets were sluggish as packers are trying to hold onto their positive profit margins as cutout values have begun to move lower. By midweek, the asking prices were $126-128 live and $202-204 dressed, but packers were only bidding $122 live in the South Plains and $197 in Nebraska by Thursday morning.

Cash trade on live cattle kept analysts guessing throughout the week. At first, expectations were for a midweek startup, then after the futures’ bust on Wednesday, analysts were calling for a lateweek trade. All the while, the cash market failed to show the repeatedly record-setting cutout values.

The most recent Cattle on Feed (COF) report came out Friday, May 17. It reported that cattle on feed as of May 1 in feedlots with a 1,000-head or larger capacity was down, while cattle placed on feed and marketed during the month of April were both up.

Choice boxed beef finished last week at a record weekly average of $207.49/cwt., up $4/cwt. from last week and up $17/cwt. from the recent lows last month. Though this market may be near a peak, the strength and duration of the recent run has been impressive and sets the stage for a stronger summer beef market.

By Thursday afternoon, about 15,000 head had been confirmed sold, adding to the 8,000 head sold throughout the week. With the exception of Texas—where live cattle sold at $125, a dollar lower than the prior week’s live price—nothing in trendsetting numbers.

Friday, May 10 saw the release of the most recent World Agricultural Supply and Demand Estimate (WASDE) report. Though the report contained very few surprises compared to prereport industry expectations, this was the first WASDE report of the year to include domestic projections for the 2013/2014 marketing year and 2013 world production estimates.

The Australian beef industry is experiencing a perfect storm of economic disaster. Drought, oversupply from closed markets, and ag policy gone awry have left Aussie producers scrambling to find an alternative to simply shooting the hundreds of thousands of excess animals which cost more to feed and ship than they’re worth at market.