(Federal-State Market News)

St. Joseph, Mo.

Aug. 16

RECEIPTS:      Auctions      Direct    Video/Internet       Total
This Week      148,700       94,200             6,200       249,100
Last Week      131,200       62,500           113,800       307,500
Year Ago       156,900       67,300            30,200       254,400
RECEIPTS:      Auctions      Direct    Video/Internet       Total
This Week      104,800       27,900            70,100       202,800
This Week      154,600       54,100           241,400       450,100
Year Ago       149,500       53,700             7,100       210,300

   Compared to last week, steers and heifers sold 5.00 to 10.00 lower.  Uncertainty 
started the week as the news spread over the weekend of a fire that has halted 
slaughter at the Finney County, Kansas fed cattle operated by Tyson Foods.  Some 
cattle auctions were either downright cancelled or saw reduced receipts as the 
industry took in the news over the weekend.  Backgrounders do like to market cattle 
before the Labor Day holiday in August and some may be forced to wait until the 
market finds footing which could be after their historical marketing time 
period.  Cattle buyers did have bids from feedyards, however most wanted to buy at 
lower prices early week as they did not know when the CME Cattle Complex slide would 
come to an end.  When the CME Cattle Complex opened on Monday morning, futures locked 
limit lower (-3.00 on Live Cattle and -4.50 on Feeder Cattle).  Expanded limits were 
instituted for Tuesday; trading was down drastically again with Live Cattle down 4.47 
to 4.95 and Feeder Cattle down 5.05 to 6.68.  Traders did want to get some business 
done and they did have an opportunity to do it.  Wednesday brought expanded limits 
again and the more nearby Live Cattle futures were lower, while the more deferred 
futures were 0.60 to 1.97 higher on the day.  Feeder Cattle futures appeared to need 
a correction and were 4.63 to 6.75 higher on the day.  When the dust settled for the 
week, the August Live Cattle contract was down 8.58 while the next five Live contract 
months were down 6.05 to 8.70.  Feeder cattle contracts were 4.33 to 6.08 lower on 
the week.  The main concern that caused all the back and forth was “How will the 
industry try to absorb near 6,000 head per day for the foreseeable future?”  Even 
though feedyards have been pulling cattle forward, the reduction of around 6 percent 
of the fed cattle slaughter capacity will put a wrench into the current marketing of 
fed cattle supplies.  On Wednesday, Tyson executive toured the devastated plant and 
vowed to get back to business in a methodical and timely fashion.  A takeaway that 
the industry was looking for when the plant will be up and running.  Company 
personnel were forthcoming in saying that it would be months, not weeks.  As the 
reduction in fed slaughter happened this week, so does the meat 
production.  Wholesalers and retailers that had been buying hand to mouth found 
sharply higher boxed beef values this week as the beef pipeline adjusts to the harsh 
reduction in production.  Price jumps like this do not come along very often and will 
be only temporary as adjustments take place in future.  For the week, the Choice 
cutout closed 22.32 higher at 238.69, while Select was 19.45 higher at 
213.26.  Processors are wanting more Choice product to sell as the Choice-Select 
spread now stands at 25.43. On Tuesday and Wednesday this week, the Choice Cutout 
rose 7.74 and 5.98 respectively, the largest single day gains since MPR data started 
in 2000.  For reference, the harshest daily drop of 7.26 for Choice was recorded on 
January 31, 2014.  With negotiated fed cattle trading at 105.00 in the Southern 
Plains this week, packer margins have skyrocketed as some analysts are estimating 
they have more than doubled in one week.  Cattle Slaughter under federal inspection 
estimated at 651K for the week, 9K more than last week and 8K less than a year 
ago.  As last week ended, there was some volatility in the grain markets expected as 
USDA was set to release a large amount of grain data and reports on Monday.  The 
abnormal growing year has been a challenge to get acres reported correctly and many 
surprises have sprung up along the way with the Crop Production reports this year so 
far.  Monday’s data release was no different as corn data, which the cattle industry 
follows faithfully, showed a reduction in planted acres and an increase in yield 
which caused grain futures and cash prices to tumble.  Normally lower feed cost would 
seem like a good thing for the cattle industry.  Auction volume this week included 49 
percent weighing over 600 lbs and 38 percent heifers.
Northwest Weighted Average Direct Feeder Cattle 
Weekly Summary WA-OR-ID-UT
Aug. 16
Receipts: 855 Last Week: 3,360 Year Ago: 1,054 
Compared to last week: Feeder steers lightly tested
on a current basis but a higher undertone noted.
Demand good. Cattle futures traded extremely volatile
all week with unique marketing factors happening
over time. Slaughter cattle trade taking effect Wednesday
and trading 5.00 lower. Supply consisted of 93 percent
over 600 lbs. and 39 percent heifers. Unless otherwise
stated prices are FOB weighting points with 2- 3 percent
shrink or equivalent and a 5-10 cent slide on calves and
a 4-12 cent slide on yearlings from base weights. Current
sales are up to 14 days delivery.
Feeder Steers
Medium and Large 1
Head Wt Range Avg Wt Price Range Avg Price Delivery
65 860 860 138.00 138.00 Current Del
430 875 875 142.00 142.00 Sep Del
30 600 600 152.00 152.00 Oct Del Split Loads
Feeder Heifers Medium and Large 1
Head Wt Range Avg Wt Price Range Avg Price Delivery
300 825 825 139.00 139.00 Sep-Oct Del
30 570 570 144.00 144.00 Oct Del Split Loads

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