Cattle Markets See Slight Correction, Continued Downward Pressure

Cattle Markets See Slight Correction, Continued Downward Pressure

Drought Monitor Update September 3

Montana Drought Monitor Update, September 3, 2015. Click image to learn more.

Moderate to Extreme drought continues along and west of the Divide, now covering 40% of the state. A continuing lack of precipitation across western Montana prompted a slight eastward shift of all drought categories.

Recent days have brought beneficial precipitation for western Washington (1.5 inches), northern Montana (2-4 inches). This combined with cooler temperatures and higher elevation snow have brought some fire and smoke relief for the region. As of Sunday afternoon, several fires are listed as active in Montana. Many areas west of the Divide remain in Stage II fire restrictions.

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

Montana Weekly Auction Report – September 4

Market: Billings Livestock, Public Auction Yards, Miles City

Receipts: 2,103; Last Week 1,529; Last Year 1,087

Compared to last report: Yearling feeder steers and heifers were too lightly tested in any one particular weight category for an accurate market trend, however steady to firm undertones were noticed on steers and steady to weak undertones were noticed on heifers. Quality this week was mixed with both average plain made offerings and very high quality fancy strings of both young calves and yearlings. Weigh-up conditions for yearlings were average to below average at times with many offerings coming straight off grass pushing some fill. Flesh conditions were very light to moderate. Flesh conditions varied drastically this week due to variable pasture and range conditions across the state. Demand for most feeder cattle was moderate, with moderate to good demand seen at times for higher quality offerings.

Weigh-up cows sold with light to moderate demand throughout the week. Weigh-up conditions were average to below average with many cows coming out of very dry country. Quality this week was mostly below average to average and notably higher than last week. Demand for Slaughter cows was mostly moderate with packers showing more willingness to purchase higher quality cows. Slaughter cows sold mostly steady on like quality. Feeding cow buyers showed some increased interest this week as higher quality cattle came through the ring.

A smaller run of cull bulls was seen this week, and many of these bulls were destined to be put on feed. Slaughter bulls sold mostly 3.00 lower. 2-3 year old cows sold with good demand this week as buyers fought over limited offerings.

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

National Feeder & Stocker Cattle Summary – September 4

Receipts This Week:  Total 211,300 – 140,700 (Auctions); 54,400 (Direct); 16,200 (Video/Internet)

Compared to last week: yearlings traded mostly steady to 3.00 higher (mostly early to midweek) with calves selling steady to 5.00 higher. Several auctions late in the week mostly in the Northern Plains were 5.00-10.00 lower when compared to two weeks ago. After last week’s emotional and very draining week of trading with big moves to the downside in the commodity and equity markets feeder cattle and fed cattle prices were some of the biggest victims of the purge. Calf and yearling prices definitely had room to correct higher; which at most auctions showed some stability and strength this week. The best demand for yearlings remains in the Northern Plains and the availability of yearling cattle is very tight which has created a good competition from cattle buyers needing to procure yearling cattle.

The fall run will soon be underway and usually calf prices feel the pressure as they are pulled off grass as receipts increase with many unweaned and fleshy calves coming to market. For the most part, feeder cattle prices are still feeling pressure from the losses of current fed cattle prices. We have previously seen huge premiums carried by the feeder cattle to the fat cattle and are starting to see a reality check as feeders are seeing prices dropping faster than the fats. Packers are seeing some decent margins, but want to keep those as long as possible, while feedyards are trying to get some of it back; fighting lower bids.

Fears of China’s financial concerns continue to bleed over into U.S. equity and commodity markets which produce a risk mentality for many of the agriculture markets and outlook for livestock prices. The velocity of last week’s sell-off should not be a surprise, but it does leave an impression on the markets. This keeps traders’ attitudes, positions and frame of minds changing fast and in a hurry.

Auction volume included 53% weighing over 600 lbs and 36% heifers.

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

Weekly Montana Hay Report – September 4

Compared to last week: Alfalfa was fully steady this week on moderate demand and light movement as many producers are in the fields harvesting other crops. Grass hay experienced much of the same movement volumes as alfalfa. Hay prices across the state have remained steady over the last few weeks. Rain is forecasted and currently falling over much of the northern half of the state and is a very welcomed sight for many dry areas. Much of the central part of the state received rain over the weekend making it hard for producers to put up third cutting. Smoky conditions from wildfires has eased some within the last week.

• Alfalfa:
  • Supreme: Small Squares, 200.00-225.00
  • Good: Large Squares, 150.00-170.00
  • Fair: Large Squares, 115.00-140.00; Large Rounds, 120.00
• Grass:
  • Alfalfa Mix Good: Large Rounds: 125.00-140.00
  • Good: Large Rounds, 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.