Severe Weather Halts Cattle Trade, Slaughter


Author: Anna Miller

Found at: Western Livestock Journal

Winter storms have made their way across the country, disrupting cattle trading and slaughter. Snow has hit much of the cattle feeding regions—which is sure to impact cattle performance—along with processing plants, limiting slaughter numbers.

“There’s another round of winter storms starting to develop, which will not only impact transportation and slaughter levels through the end of the week but will also move the focus away from marketing cattle and hogs and on to the overall animal health through the winter blast,” DTN said in its Thursday midday comments.

Live cattle futures traded mostly sideways over the week. The February contract gained 68 cents to close at $171.80, and the April contract gained 27 cents to close at $174.57.

Cash trade through Thursday was very limited on account of the storms. Total cash trade is estimated at less than 15,000 head. Live steers sold from $172-175, and dressed steers sold from $272-275.

“It is reported that some cattle have been removed from showlists due to weather factors, as feeders feel comfortable holding cattle until next week or later at this point,” DTN said.

Another round of winter storms is shifting the focus more onto preparation and less on cattle sales, the outlet continued.

Cash trade for the week ending Jan. 7 totaled 69,516 head. Live steers averaged $173.97, and dressed steers averaged $274.35.

The national weekly direct beef type price distribution for the week of Jan. 1-8 was the following on a live basis: 

• Negotiated purchases: $173.97. 

• Formula net purchases: $174.52. 

• Forward contract net purchases: $180.49. 

• Negotiated grid net purchases: $175.69. 

On a dressed basis: 

• Negotiated purchases: $274.87. 

• Formula net purchases: $277.22. 

• Forward contract net purchases: $290.50. 

• Negotiated grid net purchases: $276.78. 

Slaughter through Thursday totaled about 424,000 head. Projected total slaughter for a week earlier is 556,000 head. Actual slaughter for the week ending Dec. 30 was estimated at 500,521 head. The average steer dressed weight was 941 lbs., 1 lb. below the prior week.

Due to inclement weather from the first big winter storm of the year, several packing plants canceled kill shifts on Tuesday afternoon, which may result in a lighter total slaughter over the week. Tyson and Cargill suspended operations in Kansas after many plant workers were stranded Monday on highways or spent the night at the packing plants.

“This coming week will feature a full slaughter week,” the Cattle Report wrote in its Thursday comments. “The slaughter levels will be important to maintaining stability of price at both the feedlot and retail level for beef.”

Boxed beef prices are back trading higher on account of slower slaughter speeds. The Choice cutout gained about $10 to close at 285.89, and the Select cutout gained a little over $11 to close at $269.94.

“The new year will bring the end meats and hamburger back into the sales promotions as winter time eating of beef begins,” the Cattle Report said. “Middle meats will weaken as cold weather sets in and consumers move to roasts and hamburger.”

Early analyst reports project the upcoming Cattle on Feed report to show Jan. 1 cattle on feed higher by 2%, placements down to 97.9% of last year and marketings down to 99.4% of last year.

The biannual Cattle inventory report is projected to show a 2% decrease in all cattle and calves on Jan. 1. All classes of cattle are expected to decline in numbers.

Feeder cattle

“Artic weather is headed to the Plains over this weekend,” the Cattle Report said. “Subzero temperatures will plague cattle and people on top of recent snows.”

Weight losses are reported in all areas, with many cattle down 20-30 lbs., the report said.

Feeder cattle futures made some gains over the week. The January contract gained $1.60 to close at $226.27, and the March contract gained $1.75 to close at $227.40.

The CME Feeder Cattle Index lost 90 cents to close at $227.75.

Corn futures were lower over the week, with the March contract down 9 cents to $4.57 and the May contract down 10 cents to $4.69.

“The softness in corn markets is also helping create overall market firmness through Thursday morning, but there remains uncertainty given the recent volatility in stock markets, and the impact of inflation rating reports impacting the overall economy and thus, long-term beef demand,” DTN said.

Colorado: Winter Livestock in La Junta sold 4,196 head on Tuesday. Compared to a year earlier, feeder steers under 450 lbs. sold $10 higher while steers over 450 lbs. sold unevenly steady. Feeder heifers sold mostly $2-11 higher across all weight classes. Benchmark steers averaging 766 lbs. sold from $219.50-228.25, averaging $227.22.

Kansas: Winter Livestock in Dodge City sold 665 head on Wednesday. There was no trend to a week earlier due to the winter storm at the beginning of the week. Benchmark steers averaging 776 lbs. sold for an average of $226.25.

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