Cattle markets continue downward trend as Autumn volume increases

Cattle markets continue downward trend as Autumn volume increases

Drought Monitor Update September 24

Montana Drought Monitor Update, September 24, 2015. Click image to learn more.

Moderate to Extreme drought continues along and west of the Divide with no significant changes in recent weeks, except some decrease of abnormally dry areas in Eastern Montana. Long-term conditions remain dry heading into the Fall season.

Large sections of the nation experienced dry weather, reducing topsoil moisture but promoting summer crop maturation and harvesting. Above-normal temperatures dominated the Plains and upper Midwest, favoring fieldwork and helping to push summer crops toward maturity.

The overall trend toward drought persistence continued in our region, though pockets of beneficial rain were noted in the northern Rockies, Pacific Northwest, and lower Four Corners. The west was generally cooler than normal, easing stress on pastures, crops, and livestock. In the north, most of the region’s core Extreme Drought (D3) areas were dry. However, moderate to heavy rain on Washington’s Olympic Peninsula (2-4 inches, locally more) staved off D3 expansion. Farther east, 1 to 3 inches of rain eased drought intensity and coverage over central and southern Idaho, though northern portions of the state remained dry.

View the most current Montana conditions from the U.S. Drought Monitor.

Montana Weekly Auction Report – September 25

Market: Billings Livestock, Public Auction Yards, Miles City

Receipts: 4,574; Last Week 3,767; Last Year NA

Compared to last report: Spring born feeder steers and heifers sold sharply lower this week with most sales 15.00-20.00 lower and instances of 30.00 lower on lightweight calves. Yearling feeder steers sold mostly 10.00 lower in a narrow comparison. Yearling heifers under 900 lbs sold 10.00-15.00 lower while heifers over 900 lbs sold weak to 5.00 lower with heavier weights selling with more demand than lighter weight offerings.

Quality this week was mostly average to attractive, with several very attractive sets of both yearlings and spring born calves. Flesh conditions were in buyers favor with many lightly fleshed feeders coming off grass. However, weigh up conditions were average at best this week; yearling cattle coming off grass were more likely to push excess fill than spring calves. Demand for feeder cattle was light to moderate on yearling offerings, while spring born calves saw light demand.

Slaughter cows sold mostly 5.00-6.00 lower and feeding cows sold lower as well on a notably poor quality offering this week. The best demand for cows this week was for young 2 year olds to young age cows suitable to enter a breeding program. These offerings sold fully steady on good demand. Slaughter bulls sold mostly 2.00 lower in a narrow comparison.

Read more in USDA’s latest Montana Weekly Market Report.

National Feeder & Stocker Cattle Summary – September 25

Receipts This Week:  Total 250,600 – 177,700 (Auctions); 53,200 (Direct); 19,700 (Video/Internet)

Compared to last week: yearling feeder cattle sold mostly 5.00-10.00 lower, with instances 15.00 lower. Calves traded mostly 5.00-15.00 lower with some sales 20.00 lower throughout the Midwest and Southeast. Discounts are quickly becoming more severe on unweaned-fleshy types which complement the larger discounts on price trends on calves.

The calf market pressure is typical of autumn’s arrival with increase headcounts of new crop bawlers and the onset of warm days and cool nights. Pre-condition yard sickpens are starting to fill as the combination of separation anxiety and shipping fever takes its toll on new purchases.

Cattle futures and cash prices continued their free-fall from last week with no-way of applying the brakes to stop the bleeding. Heavy liquidation selling took place again this week in the cattle futures with limit losses on Wednesday. Futures continued in their flush out mode on Thursday closing again with sharp triple-digit losses, but then traded limit higher to close on Friday; perhaps to give some hard to come by hope for next week. Any justification for high priced feeders has worn out its welcome, as losses keep mounting for cattle feeders and the near term outlook still looking bleak. This has the feeder cattle market accelerating to the downside as feeder cattle prices now stand as excessively overpriced.

Last week’s Cattle on Feed Report did have somewhat positive news in smaller placements than expected, but lower placements are not providing any help to the fed cattle or feeder cattle market. Market psychology and beef demand definitely need a reversal along with cleaning up heavy fed cattle coming to market.

Auction volume included 49% weighing over 600 lbs and 40% heifers.

Read more from the USDA’s latest National Feeder & Stocker Cattle Summary.

Weekly Montana Hay Report – September 25

Compared to last week: Alfalfa was generally steady this week on moderate demand and light to moderate movement. Perfect weather conditions have helped producers across the west-central portion of the state put up excellent quality 3rd cutting. With third cutting still going up very few sales have taken place, however limited sales have moved at around 1.00 per RFV point. Grass hay experienced moderate movement this week with sales steady to weak. Hay for export continues to move at the bottom end of the range.

• Alfalfa:
  • Supreme: Small Squares, 200.00-225.00
  • Premium: Large Squares, 180.00
  • Good: Large Squares, 150.00-170.00
  • Fair: Large Squares, 110.00-140.00; Large Rounds, 120.00
• Grass:
  • Alfalfa Mix Premium: Large Squares: 170.00; Good Large Rounds, 125.00-140.00
  • Good: Large Squares, 135.00; Large Rounds, 115.00-120.00
  • Fair: Large Rounds, 100.00
• Timothy Grass:
  • Premium: Small Squares, 180.00-225.00
  • Good: Large Rounds, 120.00; Small Squares, 150.00
• Barley Straw:
  • Large Squares, 40.00-55.00

Read more from the USDA’s latest Weekly Montana Hay Report.