Cheap feed and demand are usually a recipe for increasing cattle marketing weights, but this year’s spike has been smaller than many expected.
Derrell Peel, Extension livestock marketing economist at Oklahoma State University, said weights were down significantly last year. He said because of strong demand, feedlots are moving cattle along as soon as they are ready, without putting on some extra pounds.
“Steer carcass weights are up about 3.5 pounds this year, while heifer carcass weights are up about 6.5 pounds,” Peel said. “We dropped those 13 and 11 pounds, respectively, last year. Weights are up, but not too much.”
Live cattle weights peaked in mid-November at about 1,521 lbs., said Lee Schulz, Extension livestock marketing economist at Iowa State University. Weights have leveled off at about 1,505 lbs. recently.
“Demand is really pushing them through the system,” Schulz said. “Export numbers are huge and we are seeing strong packer margins. There is no reason to put on extra weight.”
Cattle supplies should continue to be large in 2019, Peel said. A huge calf crop is expected in the new year, and he said he expects to see continued growth in 2020.
The large supply of calves will continue to keep feedlots full, and feeder cattle prices should stay strong because of the demand, Peel added.
Schulz expects weights to continue along a traditional seasonal pattern through March, when weights tend to start decreasing and bottom out in May and June before heading back up.
“Calf supplies will be pretty tight in the first quarter given the demand,” Schulz said. “The feedlots have done a great job of staying current. Feeder cattle are available, but they are expensive.”
He added some cow/calf producers are still retaining heifers, but expects cow herd growth to be modest.
Peel said there are additional factors that could cut into weights. He said record production of pork and poultry will likely mean lower prices for beef’s competitors.
“We expect to see record pork and poultry production in 2019 as well,” Peel said.
Trade uncertainties could also affect the beef industry.
“We need exports to stay strong,” Peel said. “The domestic economy is also a wild card.”
He encouraged producers to keep an eye open for marketing opportunities, and to be vigilant when it comes to tracking external factors such as the economy.