Grimes and Plain Weekly Cattle Outlook

CHICAGO - Dec 1/06 - SNS -- Following is a week ending cattle market comment from the University of Missouri - Columbia's Glenn Grimes and Ron Plain.

The number of cattle on feed November 1 was up 4% from 2005 and the largest number on feed in November since the current series started in 1996.

The number of cattle placed on feed in October was down 13% from 12 months earlier. The smaller number placed on feed was due at least in part to the large placements in recent months due to drought in a significant part of cow-calf country. For august, September and October total percent of cattle on placed on feed was up a short 1% from 2005 all of the increase plus was in cattle weighing less than 600 pounds. The number placed in these three months was up 20.5% for cattle weighing less than 600 pounds, 600-699 pounds placement were down 11.5%, for 700-799 pound down 12.7%, for 800 pounds and heavier down 8.4%.

Demand for beef for January - October of 2006 was down 4.2% from 12 months earlier. The good news continues to be the demand for live fed cattle. For the feed 10 months of 2006 live fed cattle demand was up 3.9% from a year earlier. The increase in beef exports, decline in beef imports and population growth are the major reasons for growth in live fed cattle demand compared to loss in demand at the consumer level. Net beef imports as a percent of production in the first nine months of 2006.

Beef exports for January - September of 2006 were up 80.3% from 12 months earlier. However, beef exports for the first nine months of 2006 were still 56.4% below the first nine months of 2003 before the cow was found with BSE in Washington State.

Beef imports for January - September were down 15.7% from a year earlier. The major reductions in beef imports by country were Australia down 5%, New Zealand down 3.1% and Canada down 27.2% and Uruguay down 43%.

The major increases in beef exports by country were Canada up 178.1%, Mexico up 63.5% Caribbean up 68.3%, Taiwan up 24.2% and other up 30.9%.

Retail beef prices for January - October were down 3%. However, the average price for fed cattle for these ten months was down only 1.1%. Based on USDA the total marketing margin for the first 10 months of the year was down 7.3% from a year earlier. The retailer-processor margin was down 9.5% but the packer's margin was up 7.1%

The average live price for fed cattle through Thursday at $85.60 per cwt was down $0.77 per cwt from a week earlier. The weighted average carcass price through Thursday was $135.25 up $1.25 per cwt at compared to 2 weeks earlier. Cattle slaughter this week under Federal Inspection was estimated at 636 thousand head up 5.1% from a year earlier.

Feeder Cattle and calf prices this week at Oklahoma City were firm to $2.00 per cwt higher with exception of 500-700 pounds steer calves $1.00-2.00 per cwt lower.

The range in prices per cwt by weight groups this week for medium and large frame no one steers were: 400-500 pounds $124.50-143.00, 500-600 pounds $110-120, 600-700 pound calves $97.00-106.75, 650-700 Pound yearlings $102.25-106.25, 700-800 pound yearlings $97.50-106.25 per cwt, 800-1000 pounds $95-103.50 per cwt.

USDA moves forward with expanding beef trade with Canada. According to news report the office of information and regulatory affairs and USDA have provided public notice that is has begun its 30-day pre-public review of APHIS proposal regulation to allow cattle over thirty months of age to enter the United States from Canada.

Issued by Glenn Grimes and Ron Plain

University of Missouri - Columbia

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