More aid in the works
This is the sixth week we have had greatly reduced cattle slaughter. With Memorial Day week approaching, it may be the first week that the weekly slaughter rate is above 500,000 head, Cassie Fish mused in The Beef.
Fish said once slaughter begins to pick up traction, boxed beef prices will finally begin to fall. However, by the time this occurs, there will still be a tremendous amount of backlogged cattle and the incentive to support cash cattle prices will decline with the drop in wholesale beef values.
Today the House of Representatives released a draft of the Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act). The bill will serve as an additional round of COVID-19 aid.
A summary of some of the bill provisions was compiled by the Cattle Report and includes: the establishment of a statutory dealer trust for livestock; emergency assistance for market-ready livestock and poultry losses (not including packer-owned animals); additional support for dairy, specialty crops, and local ag markets; support for farm stress programs; renewable fuels reimbursement program; direct payment to ag producers; amendments to the Commodity Credit Corporation; and an emergency soil health and income protection pilot program.
Tuesday’s markets
Tuesday’s estimated daily slaughter was 89,000 head, up 9,000 head from a week ago, but down 33,000 head from a year ago.
The 5-area weekly accumulated weighted slaughter cattle price for live steers was $107.03 for 2,266 head weighing an average of 1,486 lbs.; 559 live heifers weighing 1,377 lbs. averaged $108.14.
Live cattle futures surged higher today and closed limit up as beef demand continued strong. June live cattle closed at $97.17, August live cattle at $101.70, and October live cattle closed $104.17, up $2.90 from the day prior.
May feeder cattle closed at $127.30, up $3.65; August feeders at $135.75, up $3.07; and September feeders at $137.10, up $3.05. The latest known CME Feeder Cattle Index was $122.60, up $1.46.
Oklahoma National Stockyards reported feeder steers 500-600 lbs. at $145-164; 600-700 lbs. at $147-170; 700-800 lbs. at $120-137.75; 800-900 lbs. at $108-129; and 900-1,000 lbs. at $101.50-116.75.
USDA reported 5,261 confirmed head for negotiated cattle, compared to 5,965 head a week ago, and 1,190 head a year ago. Formula purchases for 13,500 head weighing an average of 884 lbs. sold for an average of $165.95.
The Choice cutout continued to grow and settled at $475.39, up $6.81, but the Select cutout saw a slight decline of $2 to close at $450.97. The spread was $24.42, and this report was based on a load of 132.
In the slaughter cow market, 75-80 percent lean averaged $54-60.50/cwt and 85-90 percent lean averaged $44-48/cwt. — Anna Miller, WLJ editor
