April 24, 2017
Feedlot marketings are supporting the fed cattle market
by Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist
The fed cattle market pushed to new seasonal highs last week over $130/cwt. Fed prices have continued to pleasantly surprise with a stronger than expected first quarter that has extended through much of April. Fed prices have been supported by strong boxed beef prices. After a brief drop in early April to $207/cwt. from the March weekly high of nearly $225/cwt., Choice boxed beef prices have recovered to $217/cwt. by late last week. Underlying strength in beef demand, both domestic and export are supporting boxed beef and fed cattle prices even as beef production is up 4.7 percent for the year to date.
The April USDA Cattle on Feed report showed an on-feed inventory fractionally higher than one year ago at 10.9 million head for feedlots over one thousand head capacity. Placements were larger than expected at 111 percent of last year and were, in fact the largest March placements in the current data series back to 1996. Placements often receive the most attention in the monthly reports and may cause some bearish reaction. While placements, along with the placement weight breakdown, provide more specific indications of the timing of fed cattle marketings and slaughter in coming months, the general idea that placements will grow should not be a surprise. Three years of confirmed herd expansion since 2014, and likely continued expansion in 2017, means that the cattle pipeline is growing, with plentiful feeder cattle supplies headed toward feedlots for months to come. Record March placements are consistent with the fact that the industry is in the first sustained herd expansion since the early 1990s, predating the current data period. However, sometimes it almost seems like increased monthly feedlot placements are viewed as a new source of supply that suddenly materialized and wasn’t already anticipated.
March marketings were 110 percent of last year. Monthly feedlot marketings often receive little attention, being viewed mostly as history by the time the report is released. However, strong marketings since mid-2016 have contributed greatly to the strength of fed cattle markets so far in 2017. The twelve month average monthly feedlot marketing rate (marketings as a percent of on-feed inventory) has been increasing since July, 2016 and is currently at the highest level since late 2014. The strong marketings rate has also helped keep days on feed down, with the Kansas Focus on Feedlot data indicating that days-on-feed is currently at the lowest twelve month average level since late 2014 as well.
Smaller carcass weights are also helping to hold beef production to smaller year over year increases and thus supporting boxed beef and fed cattle markets. Steer carcass weights were down 28 pounds year over year in the latest weekly data with heifer carcass weights similarly down 26 pounds. For the year to date, steers carcass weights have averaged 13 pounds less than last year while heifers are down 11 pounds. Aggressive marketings and reduced days on feed have played a part in smaller carcass weights. Another component is the fact that fewer heavy feeders have been placed in recent months. The percent of monthly placements over 800 pounds (twelve month average) has declined for several months. Lighter placement weight results in lighter slaughter and carcass weights.
The cattle industry in general and feedlots in particular have done a good job managing growing cattle supplies for most of the last year. If this continues the industry can do much to minimize the supply pressure coming to bear on cattle markets in the coming months. Given the reality of growing beef production, the bigger key for the foreseeable future is continued strong domestic and export beef demand.
Proper injection sites to remember at calf-working time
By Glenn Selk, Oklahoma State University Emeritus Extension animal scientist
The month of May is traditionally the time when “spring round-ups” take place. This is the time that large and small cow/calf operations schedule the “working” of the calves. As the majority of the calves reach their second month of life, it is time to castrate the male calves and immunize all of the calves to protect them against blackleg. In some situations, calves may be vaccinated for the respiratory diseases, i.e. IBR and BVD. Check with your large animal veterinarian about these immunizations.
Correct administration of any injection is a critical control point in beef production and animal health. There is a negative relationship between meat tenderness and injection sites, including injection sites that have no visible lesion. In fact, intramuscular (IM) injections, regardless of the product injected, may create permanent damage regardless of the age of the animal at the time of injection. Tenderness is reduced in a three-inch area surrounding the injection site. Moving the injection-site area to the neck stops damage to expensive steak cuts. Therefore, cow-calf producers should make certain that their family members, and other hired labor are sufficiently trained as to the proper location of the injections before the spring calf-working begins.
Give injections according to label instructions. Subcutaneous (SQ) means under the skin, intramuscular (IM) means in the muscle. Some vaccines (according to the label instructions) allow the choice between intramuscular (IM) and subcutaneous (SQ). Always use subcutaneous (SQ) as the method of administration when permitted by the product’s label. Remember to “tent” the skin for SQ injections unless instructed otherwise by the manufacturer. Proper injection technique is just one of many components of the Beef Quality Assurance effort that has had a positive impact on the entire United States beef industry.
Another important aspect of the Beef Quality Assurance effort is keeping of accurate treatment records. Treatment records should include:
- Individual animal/group identification
- Date treated
- Product administered and manufacturer’s lot/serial number
- Dosage used
- Route and location of administration
- Earliest date animal(s) will have cleared withdrawal period
- Name of person administering the product
Treatment records for cattle should be stored and kept for a minimum of three years after the animal(s) have been sold from your operation.
Oklahoma eef producers are encouraged to learn and practice Beef Quality Assurance guidelines. You can learn more about the Oklahoma Beef Quality Assurance program by going to the website: oklahomabeefquality.com. The Oklahoma Beef Quality Assurance Manual can be downloaded from that site. Examples of treatment records to be kept and stored are available from the Oklahoma Beef Quality Assurance Manual or the Oklahoma Beef Quality Assurance program website.
Cow-Calf Corner is a newsletter by the Oklahoma Cooperative Extension Agency.