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Cattle Update 5/3/21

It has been a while since I’ve done a cattle market update. Record cattle numbers are being brought to the sale which tells us that the US herd is shrinking. Also, the fact that heifer slaughter is trending higher reinforces the fact that ranchers are not refreshing their herds with younger heifers, thus herd shrinking. The Livestock Marketing Information Center is still predicting cow-calf returns will improve in 2021 and into 2022. Well, have to wait and see if those projected positive returns are large enough to kickstart herd increases. In somewhat good news, cattle feeders have been averaging about $200 ahead profit for the past several weeks which normally means that feeders are willing to pay a little more for yearlings and stockers because they are actually making some money. One caveat to that is increased feed and fuel prices. $7 corn and $3 diesel can douse a hot market fire pretty quickly. I look for the feeder to packer profit gap to widen, meaning the feeders are going to start backing up. The thought of $5 corn this winter is spooking some folks. This usually won’t affect the calf market much because we have other options like grazing programs that calves can go to. It’s grilling season and people want beef so well have to wait and see how much the feed and fuel costs are going to hurt the market.

Cows and Bulls have been steady while feeders have been $2-$4 lower over the past week.

Approximately 20% of the feeder calves we have sold in Georgia so far this year have been steers. Please cut your bulls especially if you plan to sell them 500+. You’re leaving $60 on the table when you decide not to castrate. I’ll lend you a pocket knife if you need one.