Montana Pasture Conditions Deteriorate, Heifer Inventory Up 7 Percent

Montana Pasture Conditions Deteriorate, Heifer Inventory Up 7 Percent

Drought Monitor Update July 23

Montana Drought Monitor Update, July 21, 2015. Click image to learn more.

In the Pacific Northwest, above average temperatures and precipitation deficits continue to mount across the region with growing concern about potential crop losses in central and eastern Washington. According to the NCEI climatological rankings, the contiguous U.S. average temperature for June was the second hottest in the observational record (1895–2015). On a state level, California, Idaho, Oregon, Utah, and Washington all experienced their hottest average-temperature Junes on record since 1895.

During the past week, average temperatures were below normal across much of the West with the exception of western portions of California and Oregon, eastern New Mexico, and Washington. Elsewhere, statewide reservoir storage is above average in Colorado, Idaho, Montana, and Wyoming.

The NWS WPC 7-Day Quantitative Precipitation Forecast (QPF) calls for generally dry conditions across most of the western U.S. with the exception of some modest accumulation (one-to-two inches) in northern portions of the Great Basin, northern Rockies, and North Cascades.

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

Montana Weekly Auction Summary for Week Ending July 24

Market: Billings Livestock, Public Auction Yards

Receipts: 997; Last Week 603; Last Year NA

Compared to last week: This report was not released last week due to closed markets at Billings Livestock commission and Miles City, thus no trend is available. Feeder cattle this week were mostly average to attractive quality and sold with light to moderate demand. Larger feeders coming off grass sold with the best demand as they were in light flesh and feedlot ready. Several smaller consignments of fall born un-weaned calves were offered this week with many selling at a discount to long time weaned calves.

CME futures contract prices tumbled throughout the week with the August contract down 5.875 to close at 209.775 and September down 6.40 to close at 207.625 as of Thursday night’s settlement.

Weigh-up cows sold with light demand this week on light to moderate offerings. Packer buyers were very light handed this week as they bid on cows. Large reductions in kill continue to help stabilize the cow market as harvest is currently running 4-10 percent below year ago levels. Feeding cows sold with lighter demand as well this week. There was no push from any direction and cows slid lower as a result. Quality this week was mostly average. Many cows were full and fleshy coming off grass which gave buyers another reason to pass on offerings.

Many bulls are coming off breeding season and are in very light to light flesh. Packer buyers were forced to compete with feeding bull buyers for light weight and very lightly fleshed bulls. 2-3 year old cows sold on very light demand this week for very light offerings.

Read more from USDA’s latest Montana Weekly Auction Summary.

National Feeder & Stocker Cattle Summary – July 24

Receipts This Week:  Total 162,600 – 93,700 (Auctions); 29,000 (Direct); 39,900 (Video/Internet)

Compared to last week: the downtrend continues in the feeder cattle markets as feeder cattle and calves traded unevenly steady to 5.00 lower early in the week turning mostly 7.00-10.00 lower from midweek on. Long liquidation selling and feeder cattle futures looking at sharply lower feeder cattle index pressured prices. The feeder cattle market is starting to break hard over the last several weeks and keeps buyers and sellers on the defensive and more conscious of bearish fundamentals. Prices paid for feeder cattle up till now for the most part have been very good for the backgrounder and the cow/calf man. But break evens are so distant that it’s looking impossible for any results to be positive for the cattle feeder.

Northern Livestock Video out of Billings, MT held a three-day video auction this week selling over 93,000 head of top quality feeder calves and yearlings. Some of the top prices paid included 585 head of value added (all Natural) yearling steers weighing 950 lbs sold for 230.00 for November delivery. There was near 3000 head of 900-950 lb steers averaging 910 lbs that sold with a weighted average price of 216.84 for September delivery.

Boxed-beef prices have reached their lowest levels since June 2014, as Choice product on Friday closed down 1.89 at 230.70. The market has been worried about consumer beef demand for a long time with concerns over increasing meat supplies of pork and chicken. Retail prices for June saw beef values hit an all-time high with the average price for all beef sold at retail averaging 6.11/lb.

The July 1st Cattle Inventory Report was released on Friday showing ranchers expanding the cattle herd for the first time since 2006. All cattle and calves came in at 98.4 million head, 2 percent higher than a year ago.

Highlights included:

• Beef cows at 30.5 million head, up 3 percent from a year ago;
• Replacement heifers were at 4.90 million head, up 7 percent;
• Steers over 500 lbs 14.1 million head, up 3 percent.

The 2015 calf crop is expected to be 34.3 million head, up 1 percent from last year. Cattle on Feed Report was mostly neutral to slightly bearish with Cattle on Feed for July 1st at 102 percent; Placements at 101 percent were larger than expected; Marketings were at 95 percent.

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

Weekly Montana Hay Report – July 24

Compared to last week: Alfalfa was fully steady this week as market participants have set prices and began to fully establish the market. Demand for Alfalfa is mostly moderate and moderate to good in some drier locations. Farmers are continuing to hold on to hay supplies in the hopes that prices will improve as the western drought continues to creep east. Dry conditions in extreme eastern and western Montana, as well as, along the highline, have deteriorated many pasture and range conditions. This has forced some ranchers to purchase hay as a supplemental feed. Grass hay especially has benefited from this as prices edged higher this week. Many parts of the state are starting with second cutting, however rain forecasted for Sunday has some waiting until next week to cut.

• Alfalfa:
  • Supreme: Small squares, 200.00-210.00
  • Good: Large squares, 150.00
  • Fair: Large squares, 115.00-135.00
• Grass:
  • Good: Large Rounds, 90.00-100.00
  • Large Squares, 100.00-120.00
• Timothy Grass:
  • Premium: Small Squares, 180.00.
  • Good: Large Round, 120.00

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