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Domestic, Export Beef Demand Rose In March
U.S. beef exports were up 5.2 percent in March compared to a year ago thanks to increased shipments to Mexico, Hong Kong and South Korea. The increase is remarkable given the record beef prices this year. Imports of beef into the U.S. were up 12.7 percent in March with more beef coming in from Australia, Canada and Mexico. During March, beef exports equaled 10.3 percent of production and imports equaled 12.6 percent of production. March was the first month since April 2013 with beef imports greater than exports. During the first quarter beef exports were up 4.6 percent and beef imports were up 1.0 percent. Cattle imports were up 3.8 percent in March with more cattle coming south from Canada, but fewer coming north from Mexico.
Domestic meat demand in March was up 3.2 percent with beef demand up 1.9 percent compared to a year ago. Export demand for U.S. beef was up 16.7 percent in March.
USDA said that 22 percent of U.S. pastures were in poor or very poor condition on May 4, down from 36 percent poor or very poor a year ago.
The May WASDE left unchanged USDA’s forecast of 2014 beef production, but lowered their price forecast for the year. They still predict 2014 beef production will be down 4.5 percent from last year to the lowest level since 2004. Their forecast for fed cattle prices is for the average to be somewhere between $143/cwt and $149/cwt. That is far above last year’s record of $125.89/cwt.
Fed cattle sales volume was light again this week. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $150.02/cwt, up $2.23 from last week’s average and up $23.80 from a year ago. The 5 area average dressed price for steers was $236.05/cwt, down 33 cents for the week and up $33.31 from the same week last year.
Boxed beef prices were lower this week. This morning the boxed beef cutout value for choice carcasses was $223.89/cwt, down $5.35 from the previous Friday. The select carcass cutout is $213.17/cwt, down $5.09 from last week.
This week’s cattle slaughter totaled 597,000 head, down 1.8 percent from the previous week and down 5.1 percent from the corresponding week last year. The average steer dressed weight for the week ending on April 26 was 841 pounds, down 3 pounds from the week before, but up 1 pound compared to the same week last year.
Feeder cattle prices at this week's Oklahoma City auction were mostly $1 to $5 higher. This week's prices for medium and large frame #1 steers by weight were: 450-500# $227-$235, 500-550# $216.50-$232, 550-600# $210-$223, 600-650# $195-$218, 650-700# $190.50-$207.50, 700-750# $184-$196.50, 750-800# $177-$186.50, 800-900# $162.50-$182, and 900-1000# $163-$170.10/cwt.
The June live cattle futures contract closed at $138.05/cwt today, unchanged from last week's close. August fed cattle settled at $138.20, up 85 cents for the week. October settled at $142.45/cwt, up 73 cents from the previous Friday. The May feeder cattle contract ended the week at $184.51/cwt, up $1.01 for the week. August feeders closed at $191.37/cwt. ∆
DR. RON PLAIN AND DR. SCOTT BROWN: Agricultural Economists, University of Missouri
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