By Doug Schmitz
KNOXVILLE, Tenn. – As the market moves through November, calf and feeder cattle prices will begin to turn the corner, especially as the market moves into December, and finally January, despite the uncertainty of beef movement by Thanksgiving and Christmas, said Andrew P. Griffith, University of Tennessee assistant professor of agricultural economics.
He said fed cattle traded $2 higher, compared to the week ending Oct. 31 on a live basis. Prices on a live basis were primarily $105 to $107, while dressed prices were mainly $163 to $167.
The five-area weighted average prices through Nov. 5 were $106.35 live, up $2.19, compared to last week, and $165.30 dressed, up $5.60 from the previous week. A year ago, prices were $114.16 live, and $181.41 dressed.
“It is uncertain if cattle feeders are glad the calendar page has been flipped to November, but they are certainly glad prices moved in a positive direction (the week ending Nov. 7),” he said. “The gains this week should be the start of a slow and steady climb moving into the holiday season.”
But he said there remains uncertainty as it relates to beef movement for the end-of-the-year holidays. “However, seasonal beef demand will spur some type of price run that will benefit cattle feeders,” he said.
The real question, he said, is how much of a benefit will it be to cattle feeders?
“December futures still have live cattle trading below $109, but optimism says there is potential to push the live cattle market as high as $115 before the end of the year,” he said.
Based on Tennessee weekly auction market price averages, Griffith said steer prices were $3 to $6 higher, compared to the previous week, while heifer prices were $4 to $8 higher, compared to the previous week. Slaughter cow prices were steady to $3 higher, while bull prices were steady to $2 higher, compared to the previous week’s prices.
“The gain in calf and feeder cattle prices (the week ending Nov. 7) offset the losses from the prior week, which still means cattle prices are low,” he said. “Despite prices being low, a week with higher prices brings optimism to many cattle producers. Will the higher prices this week mean more cattle being hauled to town in the coming week?
“It very well could mean that, but it is likely many producers are holding on to calves, given the good grass conditions most producers in the Southeast still have,” he added. “The plentiful moisture and the warm temperatures through October and early November have resulted in abundant grass resources and perfect conditions for stockpiling cool season perennial grasses.”
He said the weather conditions have also been extremely favorable for winter annual forage production, which may also result in producers holding calves a little longer.
“Despite the factors that are keeping some calves at home right now, those calves will eventually make their way to the market,” he said. “Those calves will most likely come to market a little heavier than is typical because they will be a little older, but it may reduce the riskiness of purchasing those calves if they do not come to market until after the large temperature swings.”
He said the 30- and 40-degree temperature swings that have been common the past several weeks are tough on freshly weaned calves that spend several hours on a trailer, which is one reason calf prices decline in the fall.
“As the market moves through November, producers can rest assured that calf and feeder cattle prices will begin to turn the corner – especially as the market moves into December and finally January,” he said.