Cattle Market Situation and Outlook: 2015 and...
Transcript of Cattle Market Situation and Outlook: 2015 and...
10/30/2014
1
Cattle Market Situation and Outlook: 2015 and Beyond
Derrell S. PeelBreedlove Professor of Agribusiness and Extension Livestock Marketing Specialist
Oklahoma State University
C-P-0610/12/14
50
75
100
125
150
175
200
225
250
275
300
1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016
$ Per Cwt
AVERAGE ANNUAL CATTLE PRICESSouthern Plains
500‐600lb Steer Calves 700‐800lb Feeder Steers Fed Steers
Data Source: USDA‐AMS, Compiled and Analysis by LMIC
Livestock Marketing Information Center
10/30/2014
2
WHOLESALE BEEF PRICEChoice, Monthly
120130140150160170180190200210220230240250260
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
$ Per Cwt
Livestock Marketing Information Center
Data Source: USDA‐AMS & USDA‐NASS, Compiled & Analysis by LMIC
FED, FEEDER AND CALF PRICESWeekly
80
100
120
140
160
180
200
220
240
260
280
300
2009 2010 2011 2012 2013 2014
$ Per Cwt.
Fed 775 lb. Steers 475 lb. Steers
10/30/2014
3
C-P-3510/27/14
45
55
65
75
85
95
105
115
125
135
145
JAN APR JUL OCT
$ Per Cwt.
SLAUGHTER COW PRICESSouthern Plains, 85‐90% Lean, Weekly
Avg. 2008‐12 2013 2014
Data Source: USDA‐AMS
Livestock Marketing Information Center
C-N-3007/28/14
20
25
30
35
40
1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014
Mil. Head
JANUARY 1 FEEDER CATTLE SUPPLIESResidual, Outside Feedlots, U.S.
Data Source: USDA‐NASS
Livestock Marketing Information Center
10/30/2014
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TOTAL BEEF COW INVENTORY BY CYCLEU.S., January 1
28
29
30
31
32
33
34
35
36
37
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14
Mil. Head
1990-04
2004-14
C-N-4001/31/14Livestock Marketing Information Center
Data Source: USDA‐NASS, Compiled & Analysis by LMIC
C-N-3807/28/14
4.5
5
5.5
6
6.5
7
1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014
Mil. Head
HEIFERS HELD AS BEEF COW REPLACEMENTSJanuary 1, U.S.
+1.7 %
Data Source: USDA‐NASS
Livestock Marketing Information Center
10/30/2014
5
C-S-1210/23/14
625
675
725
775
825
875
JAN MAR MAY JUL SEP NOV
Thou. Head
HEIFER SLAUGHTERFederally Inspected, Monthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐NASS
Livestock Marketing Information Center
C-S-2010/23/14
170
190
210
230
250
270
290
310
330
350
JAN MAR MAY JUL SEP NOV
Thou. Head
BEEF COW SLAUGHTERFederally Inspected, Monthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐NASS
Livestock Marketing Information Center
10/30/2014
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JANUARY 1 BEEF COW INVENTORYU.S., Annual
28
30
32
34
36
38
4019
82
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
Mil. Head
Analysis by Derrell Peel
Data Source: USDA‐NASS22 Sep 2014
U.S. Ave., -11.0 %
Change in Beef Cow Inventory, January 1, 2007‐2014
‐21.1%
‐7.0%
+6.8%
‐5.9%‐5.3%
‐3.4%‐5.7%
‐12.0%‐1.75, 2011
‐15.9%+6.1, 2011
‐5.5%
‐25.1%‐3.7%, 2011
‐13.6%
‐7.7%
‐16.2%
+0.3%
+2.0%
‐7.4%
‐23.1%
‐2.3%‐17.9%
‐4.2%
‐12.4%‐5.0%
‐11.0%
‐13.6%
‐8.2%
‐9.4%
‐2.3%
‐14.3%
‐8.2%
+2.4%
+5.6%
+13.3%
‐2.9%
‐7.5%
Source: USDA‐NASS, Analysis by Derrell Peel
10/30/2014
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U.S. Ave., -3.6 %
Percent Change in Pasture Acreage,
2007‐2012
‐13.1%
‐1.6%
‐3.0%
‐1.1%+0.2%
+2.6%‐7.2%
‐4.4%+0.2%
‐2.4%
‐1.4%
‐11.5%
+5.8%
‐18.9%
‐5.7%
‐4.9%
‐3.8%
‐9.9%
‐9.7%‐23.5%
‐1.4%
‐21.2%‐5.6%
+0.30%
‐31.0%
‐8.7%
‐15.9%
‐19.0%
‐20.8%
‐9.6%
‐14.8%
‐23.6%
‐16.6%
‐15.1%
‐2.6%
Source: USDA‐NASS, Census of AgricultureAnalysis by Derrell Peel
10/30/2014
8
10
15
20
25
30
35
40
May Jul Sep
Percent
US RANGE AND PASTURE CONDITIONPercent Poor and Very Poor, Weekly
Avg. 2008‐12 2013 2014
Data Source: USDA‐NASS, Compiled & Analysis by LMIC
Livestock Marketing Information Center
G-NP-3010/27/14
10/30/2014
9
G-NP-3310/27/14
15
20
25
30
35
40
45
50
55
May Jul Sep
Percent
SOUTHERN PLAINS REGION RANGE AND PASTURE CONDITION
Percent Poor and Very Poor, Weekly
Avg. 2008‐12 2013 2014
Data Source: USDA‐NASS, Compiled & Analysis by LMIC
Livestock Marketing Information Center
C-N-1010/24/14
9.5
10
10.5
11
11.5
12
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Mil. Head
CATTLE ON FEEDUS Total, Monthly
Avg. 2008/12 2013 2014
Data Source: USDA‐NASS
Livestock Marketing Information Center
10/30/2014
10
C-P-2110/01/14
75
100
125
150
175
200
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
$ Per Cwt
CHOICE STEER PRICE vs BREAKEVENCattle Feeding, S. Plains, Monthly
Steer Price Breakeven Projected Breakeven
Data Source: USDA‐AMS & USDA‐NASS, Compiled & Analysis by LMIC
Livestock Marketing Information Center
Latest Data: September 2014
C-P-2210/01/14
‐325
‐275
‐225
‐175
‐125
‐75
‐25
25
75
125
175
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
$ Per 1000 lbs
AVERAGE RETURNS TO CATTLE FEEDERSFeeding 725 Lb. Steers. S. Plains, Monthly
Data Source: USDA‐AMS & USDA‐NASS, Compiled & Analysis by LMIC
Livestock Marketing Information Center
Latest Data: September 2014
10/30/2014
11
200
220
240
260
280
300
320
340
360
380
400
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
1000 Head
CATTLE ON FEEDOklahoma Total, Monthly
Avg. 2008/12 2013 2014
Data Source: USDA‐NASS
Livestock Marketing Information Center
Share of Cattle on FeedTexas and Oklahoma, 12 Month Moving Ave.
21.0%
23.0%
25.0%
27.0%
29.0%
31.0%
Jan‐97
Jan‐98
Jan‐99
Jan‐00
Jan‐01
Jan‐02
Jan‐03
Jan‐04
Jan‐05
Jan‐06
Jan‐07
Jan‐08
Jan‐09
Jan‐10
Jan‐11
Jan‐12
Jan‐13
Jan‐14
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Share of Cattle on FeedIowa and Nebraska, 12 Month Moving Ave.
21.0%
23.0%
25.0%
27.0%
29.0%
31.0%
Jan‐97
Jan‐98
Jan‐99
Jan‐00
Jan‐01
Jan‐02
Jan‐03
Jan‐04
Jan‐05
Jan‐06
Jan‐07
Jan‐08
Jan‐09
Jan‐10
Jan‐11
Jan‐12
Jan‐13
Jan‐14
Texas Triangle and Omaha Corn Prices
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
2011 2012 2013 2014
$ Per Bushel
Omaha
Texas
Livestock Marketing Information Center
Data Source: USDA‐AMS & USDA‐NASS, Compiled & Analysis by LMIC
10/30/2014
13
C-S-0910/23/14
2200
2300
2400
2500
2600
2700
2800
2900
3000
3100
JAN MAR MAY JUL SEP NOV
Thou. Head
COMMERCIAL CATTLE SLAUGHTERMonthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐NASS
Livestock Marketing Information Center
C-S-18A10/24/14
760
770
780
790
800
810
820
830
JAN APR JUL OCT
Pounds
CATTLE DRESSED WEIGHTFederally Inspected, Weekly
Avg. 2008‐12 2013 2014
Data Source: USDA‐AMS & USDA‐NASS
Livestock Marketing Information Center
10/30/2014
14
C-S-1810/24/14
810
820
830
840
850
860
870
880
890
900
910
JAN APR JUL OCT
Pounds
STEER DRESSED WEIGHTFederally Inspected, Weekly
Avg. 2008‐12 2013 2014
Data Source: USDA‐AMS & USDA‐NASS
Livestock Marketing Information Center
M-S-0210/23/14
1700
1800
1900
2000
2100
2200
2300
2400
JAN MAR MAY JUL SEP NOV
Mil. Pounds
COMMERCIAL BEEF PRODUCTIONMonthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐NASS
Livestock Marketing Information Center
10/30/2014
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BEEF PRODUCTION vs. BEEF COW INVENTORY
Inventory on January 1, U.S.
28
29
30
31
32
33
34
35
36
37
1987 1990 1993 1996 1999 2002 2005 2008 2011 2014 2017
Mil. Head
22
23
24
25
26
27
28Bil. Pounds
Commercial Beef Production
Beef Cow Inventory
M-S-2308/10/12Livestock Marketing Information Center
Data Source: USDA‐AMS, Compiled & Analysis by LMIC
M-P-1109/17/14
375
400
425
450
475
500
525
550
575
600
625
JAN MAR MAY JUL SEP NOV
Cents Per Pound
RETAIL BEEF PRICEAll Fresh, Monthly
Avg. 2008‐12 2013 2014
Data Source: Bureau of Labor Statistics & USDA‐ERS
Livestock Marketing Information Center
10/30/2014
16
RETAIL BEEF PRICEMonthly
350
375
400
425
450
475
500
525
550
575
600
625
650
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
$ Per Cwt
All Fresh
Choice
Livestock Marketing Information Center
Data Source: USDA‐AMS & USDA‐NASS, Compiled & Analysis by LMIC
M-P-0509/17/14
300
320
340
360
380
400
420
440
JAN MAR MAY JUL SEP NOV
Cents Per Pound
RETAIL PORK PRICEMonthly
Avg. 2008‐12 2013 2014
Data Source: Bureau of Labor Statistics & USDA‐ERS
Livestock Marketing Information Center
10/30/2014
17
M-P-1209/17/14
170
175
180
185
190
195
200
205
JAN MAR MAY JUL SEP NOV
Cents Per Pound
RETAIL CHICKEN PRICEBroiler Composite, Monthly
Avg. 2008‐12 2013 2014
Data Source: Bureau of Labor Statistics & USDA‐ERS
Livestock Marketing Information Center
I-N-1610/06/14
150
170
190
210
230
250
270
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Mil. Pounds
US BEEF AND VEAL EXPORTSCarcass Weight, Monthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐ERS & USDA‐FAS
Livestock Marketing Information Center
10/30/2014
18
I-N-0608/29/14
0.0
0.5
1.0
1.5
2.0
2.5
3.0
1991 1994 1997 2000 2003 2006 2009 2012 2015
Bil. Pounds
US BEEF AND VEAL EXPORTSCarcass Weight, Annual
Data Source: USDA‐ERS & USDA‐FAS, Compiled & Analysis by LMIC
Livestock Marketing Information Center
I-N-1510/06/14
145
165
185
205
225
245
265
285
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Mil. Pounds
US BEEF AND VEAL IMPORTSCarcass Weight, Monthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐ERS & USDA‐FAS
Livestock Marketing Information Center
10/30/2014
19
I-N-1208/29/14
1.5
2.0
2.5
3.0
3.5
4.0
1991 1994 1997 2000 2003 2006 2009 2012 2015
Bil. Pounds
US BEEF AND VEAL IMPORTSCarcass Weight, Annual
Data Source: USDA‐ERS & USDA‐FAS, Compiled & Analysis by LMIC
Livestock Marketing Information Center
I-N-0310/06/14
30
50
70
90
110
130
150
170
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Thou. Head
US CATTLE IMPORTS FROM MEXICOMonthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐ERS & USDA‐FAS
Livestock Marketing Information Center
10/30/2014
20
I-N-0410/06/14
30
50
70
90
110
130
150
170
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Thou. Head
US CATTLE IMPORTS FROM CANADAMonthly
Avg. 2008‐12 2013 2014
Data Source: USDA‐ERS & USDA‐FAS
Livestock Marketing Information Center
Price‐Weight RelationshipMedium/Large No. 1 Steers, Okla 7 Mkt. Ave.
150165180195210225240255270285300315330345
375 425 475 525 575 625 675 725 775 825 875 925
weight (pounds)
Pri
ce (
$/cw
t)
12-Sep-14
24-Oct-14
Nov-13
10/30/2014
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Steer Price, Total Value and Value of Gain October 24, 2014, 7 Mkt. Ave., Oklahoma
Weight (lbs)
Average Price ($/cwt.)
Total Value ($/hd)
VOG400 lb. Beg. Weight($/lb.)
VOG450 lb. Beg. Weight($/lb
VOG500 lb. Beg. Weight($/lb.)
VOG550 lb. Beg. Weight($/lb.)
VOG600 lb. Beg. Weight($/lb.)
VOG650 lb. Beg. Weight($/lb.)
400 $322.26 $1,289
450 $304.80 $1,372 $1.65
500 $286.43 $1,432 $1.43 $1.21
550 $271.16 $1,491 $1.35 $1.20 $1.18
600 $261.13 $1,567 $1.39 $1.30 $1.35 $1.51
650 $254.22 $1,652 $1.45 $1.40 $1.47 $1.61 $1.71
700 $249.23 $1,745 $1.52 $1.49 $1.56 $1.69 $1.78 $1.84
750 $244.76 $1,836 $1.56 $1.55 $1.61 $1.72 $1.79 $1.83
800 $236.35 $1,891 $1.50 $1.48 $1.53 $1.60 $1.62 $1.59
850 $227.86 $1,937 $1.44 $1.41 $1.44 $1.48 $1.48 $1.42
900 $218.59 $1,967 $1.36 $1.32 $1.34 $1.36 $1.34 $1.26
C-P-6609/10/14
‐100
0
100
200
300
400
500
1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
$ Per Cow
ESTIMATED AVERAGE COW CALF RETURNSReturns Over Cash Cost (Includes Pasture Rent), Annual
Data Source: USDA‐AMS, Compiled and Analysis by LMIC
Livestock Marketing Information Center
10/30/2014
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2015 Market Situation
• Strong prices for cattle and beef
• Record cow‐calf returns
• Value of gain for stocker production
• Market versus production risk
• Margin squeeze for feedlots and packers
• Beef demand challenges
• Continued herd rebuilding– If no drought