June 2019 Cattle Projections
2019 June Form-A-Feed Cattle Projections show a mixed bag when it comes to profits and COG (cost of gain).
Still taking into consideration the pressure that the delayed harvest has on getting crops, i.e. feedstuffs, into the ground puts a lot of pressure on the cattle market when many feedlots are already short of feedstuffs due to the winter scenario we were dealt.
The biggest jump can be seen on the corn cash basis around the Midwest. When all livestock entities are competing for corn amongst a slow planting season, it wasn’t that the price hike wasn’t expected. It just seemed to happen at the wrong time. With many fields finally emerging, many of the cattle feeders are sighing some relief as we can always feed higher moisture feedstuffs, unlike many of our other livestock entities.
Hay is finally getting put up, but I don’t expect to see much relief on the price per ton until many feedlot operators restock the volume they had to use up this year. Even corn stalks are still running high due to many folks having to use their bedding supplies as feed and are therefore short on bedding now as well.
The price of cattle currently seems to be delayed as we follow a high grilling Father’s Day weekend. With feed prices being high, the board hasn’t followed as nicely as it should to put many in the position to buy. This can be seen in the current monthly projections. Many feedlot operators were competing for yearling steers to refill pens, and it shows in the weekly bid on those heavier weight cattle. This allows some buying power for the lighter weight cattle, especially heifers as we come into the summer heat if you have enough forage to support a lighter animal.
Holstein price has dropped for purchase, but once again the outcome will depend on if you can get these cattle contracted with many packers still in the driving seat for both competition and price.
The live cattle market was lower following this last week, even though our choice/select spread should be at one of its highest peaks leading up to the 4th of July weekend. It seems the cattle feeding segment is full of some new scenarios as we wait to see what the live cattle will trade and what the packers will continue to offer.
Watching your COG will be critical in addition to procuring feedstuffs to keep your yards full. The big unknown still seems to be if the cash corn and cattle on feed inventory will come together or if the pressure of high priced corn and many yards without enough feed will deter many feedlots from filling over the summer in lieu of searching for alternative feeds.
For more precise cattle projections for your operation please contact your local Form-A-Feed Nutrition and Production Specialist.