Beef Market Advisor

Friday, May 10, 2002

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Drought Update For U.S. Cattle Industry
Source: Cattle - Glenn Grimes & Ron Plain, Ag Econ, Univeristy Of Missouri

May 10,2002

The west is starting the grazing season quite dry. Pasture conditions
as reported by USDA for the May 6 release showed the states of
Arizona, Colorado, Kansas, Montana, Nebraska, New Mexico, North
Dakota, Oklahoma, Texas, and Wyoming at 53 percent of fair conditions
or better for the 10 states. This compares with 77 percent fair or
better in 2001 for this date and a 5-year average of 86 percent.

The 48 states had an average of 77 percent of the pasture in fair
conditions or better. The US was 83 percent fair or better on this
date in 2001.

Missouri has 95 percent of the pasture in fair or better conditions at
the beginning of May. After the rains of the past week, Missouri
pastures are likely to improve in the next few days.

Unless the west gets timely rains this spring and summer, it may push
some cattle into feedlots earlier than normal.

Due to underestimating the population growth in the US during the
decade of the 90's the per capita consumption of all meats for this
period was revised by USDA. This reduced per capita consumption by
about 3 percent from the previous estimates.

These revisions resulted in our demand index showing all meats at a
lower level than the previous estimates.

The good news for beef is that demand still grew during 1999, 2000,
and 2001. Our estimates of demand for beef in 2001 showed beef demand
at 77.3 percent of 1985. That was up from 70.8 percent of 1985 in

Cash fed cattle prices jumped sharply higher this week. However, with
the probability of increased fed cattle supplies over the next several
weeks it will take tremendous demand strength to push cash prices much
higher in the short run.

Feeder cattle prices at Okalahoma City were also higher this week.
Feeder steers were $1-3 per cwt better than last week with greatest
advance on cattle weighing over 800#. Feeder heifers were $1-2 per
cwt higher than 7 days earlier. Stocker steers under 700# and heifers
under 600# were steady to $4 per cwt lower than a week earlier.

The price for medium and large frame number 1 steers by weight groups
were: 400-500# $93-107.50, 500-600# $89-97, 600-700# $83.50-90,
700-800# $75.75-84.50, and 800-1000# $67.25-79 per cwt.

Slaughter this week under Federal Inspection was estimated at 695
thousand head down 3.5% from a year earlier.

Fed cattle prices for the 5 market area were $63 to $67 live and $103
to $106 in carcass.

posted by Dr. Harlan Hughes 2:43 PM [edit]

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