Higher Prices Looming

Fall Bred Heifer On-Line Sale!

Opens August 20th - 8 a.m. Closes August 21st - 8 p.m. (soft close) Approximately 30 Balancer & Gelbvieh heifers from Seedstock Plus Members!

Watch the website & Facebook page for updates and information!

Fall Bull & Female Sale

October 15, 2022 * 12 noon Joplin Regional Stockyards, Carthage, MO Selling 150 Angus, Gelbvieh & Balancer bulls! ALL BLACK & 18 months old!! Also registered & commercial females!!

Red Reward Fall Bull & Female Sale

November 5, 2022 * 12 noon Wheeler Livestock, Osceola, MO Selling 50 Gelbvieh & Balancer bulls! ALL RED & 18 months old!! Also registered & commercial females!!

877-486-1160

toll free to request catalogs! Or email: john@seedstockplus.com John cell# 660-734-1165 www.seedstockplus.com for updates & videos!

Higher Prices Looming

Markets are showing glimmers of the expected surge higher.

By Wes Ishmael

Cattle prices budged higher through the spring but never caught fire as expected—the dog-eared mountain in the distance so close but still so far away.

Supply chain disruptions associated with Russia’s invasion of Ukraine—yet another black swan event—rocked commodity markets, adding fuel to already-rampant inflation. Drought forced more cattle to feedlots sooner and elevated beef cow slaughter, increasing beef production near the previous year’s record level.

By the middle of June, though, apparent feedlot marketing currentness, borne by aggressive cattle slaughter began to hint at what’s coming.

October Feeder Cattle and Live Cattle futures gained $6 from the end of May to the middle of June. The CME Feeder Cattle Index increased $7.20 during the same period to $160.56. The five-area direct average steer price gained $5.60 on a live basis through the first three weeks of June to a seasonal high of $143.67/cwt. The average price in the beef climbed $7.84 to $229.73.

There’s a wide swath of fed cattle to come from elevated placement levels in recent months, then it likely will be challenging to find cattle to pull forward.

Accelerated Beef Cow Slaughter Continues

Year-to-date beef cow slaughter was 15% more than last year through the end of May and likely will end the year with a double-digit increase, says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his mid-June market comments.

“While some drought reduction regionally has improved pasture conditions, range and pasture conditions nationally are still at the worst level ever for this time of year,” Peel explains “In other areas, drought continues to expand. Colder than normal weather in northern regions this spring and reduced fertilizer use everywhere are also contributing to delayed and reduced pasture and hay production. The most recent weeks of slaughter data have year-over-year beef cow slaughter increasing rather than decreasing, as the reality of reduced pasture and hay production becomes clear moving into June.”

Based on weekly actual slaughter data from the Agricultural Marketing Service, ERS analysts say that for the first four weeks of May, beef cow slaughter averaged 10,000+ head more per week than the same period last year.

Peel points out this year’s beef cow slaughter increase comes after last year’s elevated level, which was 9% more than the previous year for a net herd culling rate of 11.6%. Beef cows in the Jan. 1 inventory were 2.3% less than the prior year—4.9% less than the recent peak number in 2019.

“Given beef cow slaughter so far this year, a significant level of culling is guaranteed…” Peel says. “The current level of beef cow slaughter suggests a culling rate in excess of 13% this year and a potential beef cow herd decline of 1 million head or more.”

Prices Ahead

“Continued drought in some regions of the country is still influencing the market as cow and heifer slaughter