Yes, we all heard and saw reports of a load of steers in exactly the right condition and in exactly the right spot at exactly the right time bringing more.
But generally speaking, there was extreme resistance at the 160 level from cattle feeders in the cash market and speculating investors on the board, very similar to the resistance seen in the finished cattle market at 130.
We may have hit a short-term ceiling on feeder cattle prices, but that’s not to say records won’t be broken again. The recent $10 correction on both fats and feeders may entice investors to re-enter cattle futures when hard evidence surfaces that cattle numbers are indeed low.
One of these months, the cattle-on-feed report will reflect just how short supplies really are and this most recent market rally might seem mild in comparison.
Stocker cattle and calf demand also ran out of steam in late March and early April even though the arrival of spring found grazing conditions in many areas to be ample.
Also, the mild winter made the new-crops not as attractive to buyers, with many calves carrying excess flesh while long-time weaned or short yearling stockers became nearly extinct.
Backgrounders started assembling their turnout cattle last fall and throughout the winter as expectations were that the availability of lightweights would be tight this spring.
This explains why pee-wee calves topped $2 per pound during the dead of winter. Most mainstream grass orders had been long filled by mid-April, as backgrounders were chomping at the bit to turn cattle out.
Kansas Flint Hills’ graziers could hardly wait for the burn-off fires to quit smoking, as they were anxious to start acquiring that cheap gain.
Sightings of corn planters were reported throughout the Midwest well before April Fools’ Day and cattle people are cheering them on.
Farmers are now expected to plant 95.9 million acres of corn, which is 1.9 million more acres than the previous estimate, 1.2 million more than the average of analysts’ guesses and the highest acreage level of corn planted since 1937.
Many of these extra acres were stolen from a cow, and corn production in some new fields can now go all the way to the ditch without the fencerows in the way. A decent harvest could more than double our ending stockpiles in one year, making some row-croppers wish they were still weaning $1,000 calves off that dirt.
The Southwest technically remains in drought status, but the eastern half of Texas has seen substantial moisture in recent months and now has the pond water and grass to support cattle once again.
These Texans may be slow to restock their ranches but breeding stock will nevertheless be in high demand as they don’t want to be accused of being “all hat.”
Ground beef processors continue to struggle with eroded supplies of available slaughter cows following the massive selloff over the last several years.
Now, the media frenzy over the use of lean finely textured beef (LFTB) has thrown another hurdle in the packer’s path with the uninformed overuse of the derogatory moniker that will not be promoted in this market narrative.
The use of LFTB helps hamburger blenders ensure the safety of the product and raises the leanness that consumers think they want.
Nobody said slaughter was supposed to be pretty, but that fear-mongered catchphrase is actually making beef’s most affordable product more expensive and harder to safely produce, without any benefits to the consumer.