Grimes and Plain Weekly Cattle Outlook

CHICAGO - Apr 9/07 - SNS -- Following is a week ending cattle market comment from the University of Missouri - Columbia's Glenn Grimes and Ron Plain.

Demand for beef at the consumer level for December, January and February was down 0.8% from a year earlier, which was good compared to the competition. For these 3 months, consumer demand for pork was down 2.8%, broilers were down 8.3% and turkey was down 13.4%.

Demand for live fed cattle for December-February was down but only 0.4% from 12 months earlier.

Have we finally come to that time where broiler demand at the consumer level will not grow practically every year? For all of 2006, broiler demand was down over 7% from 12 months earlier. If broiler demand at the consumer level continues down through 2007, near the 2006 level, the decline will be the first major decline in consumer broiler demand since the early 1980s.

The futures market for corn responded to the March 30 acreage planting report by being limit-down on most contracts both Friday and Monday. Tuesday showed modest losses, but Wednesday morning some of the contracts were up a little. If all of the 90.45 million acres get planted, corn prices for the next year will be high relative to the last several years with the exception to 2006, but will be some lower than expected in early March of this year.

These lower corn prices will be positive to feeder cattle prices. Remember, with all other costs held constant a $0.10 per bushel increase in corn prices lowers 400-pound calves by $1.00-1.25 per cwt and 600-pound yearlings by about $0.75 per cwt.

At Oklahoma City this week feeder and stocker steers were steady to $2 per cwt higher and feeder and stocker heifers were $2-3 per cwt higher than last week. Steer and heifer calves were lightly tested and steady.

The prices for medium- and large-frame number one steers by weight groups were: 400-500 pounds $130-143 per cwt, 500-600 pounds $126-134 per cwt, 600-700 pounds $112-131 per cwt, 700-800 pounds $105.50-116 per cwt and 800-1,000 pounds $97.75-105.50 per cwt.

Replacement cow prices this week at Oklahoma City showed cows pre-tested for bangs, pregnancy and age as follows. One-two years old, weighing 850-1,000 pounds, bred 6-8 months, average- to high-quality $800-825 per heard. Three-four years old, 990-1,400 pounds, bred 5-7 months, average- to high- quality $885-910 per cwt.

Wholesale beef prices this Friday morning showed Choice beef up $6.97 per cwt at $158.64 per cwt from a week earlier. Select beef prices at $150.79 per cwt were up $7.96 per cwt from 7 days earlier.

The weighted average price for live cattle for the 5-market area at $99.94 per cwt was up $4.19 per cwt from a week earlier. The weighted average negotiated carcass price for the 5-market area through Thursday was up $5.20 per cwt at $159.70 per cwt.

Cattle slaughter under Federal Inspection was estimated at 606 thousand head, down 4.7% from a year earlier.

Issued by Glenn Grimes and Ron Plain

University of Missouri - Columbia

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