The cull cow market continues to remain strong as demand continues for ground beef.
Andrew Griffith, Extension ag economist with the University of Tennessee, says prices were $2 higher last week for cull cows, while bull prices remained steady.
“The slaughter cow and bull market continue to be supported at this time as the demand for lean grinding beef remains strong,” he says in his weekly market outlook.
“The expectation is that prices will begin to soften on these classes of animals as more of these animals make their way to the market from September through November. The encouragement at this time is for producers to move these cattle sooner rather than later to capitalize on a strong salvage value.”
Calf prices remained strong, although Griffith says it is unknown how long prices will remain at their current levels.
“Seasonal weakness will influence the calf market as a larger quantity of animals come to market,” he says.”
Last week’s USDA Cattle on Feed report for feedlots with a 1,000 head or more capacity indicated cattle and calves on feed as of Aug. 1, 2021, totaled 11.07 million head, down 1.9% compared to a year ago, with the pre-report estimate average expecting a decrease of 1.8%.
July placements in feedlots totaled 1.74 million head, down 8.1% from a year ago with the pre-report estimate average expecting placements down 7.0%. July marketings totaled 1.90 million head, down 4.5% from 2020 with pre-report estimates expecting a 3.6% decrease in marketings. Placements on feed by weight showed cattle under 700 pounds down 14.3%, 700 to 899 pounds down 6.6%, and 900 pounds and over up 3.8%.
“Finished cattle prices are demonstrating strength, but there is a clear difference in the North and the South,” Griffith says. “Prices in the South appear to be much softer than those in the North. This price difference is likely due to supply and expected quality grade.
“Beef prices are strong enough that one could expect fed cattle prices to continue escalating, but there is no guarantee in that thought process as fed cattle prices tend to be soft this time of year. Cattle feeders will be betting on higher prices in the fourth quarter.”