Market Report - April 6, 2023

Ross Bronson, Ag Risk Consultant, Redd Summit Advisors

Cattle Market Report

The fed cattle market has been in a steady climb, to put it mildly. Packers are finally accepting that their cull cow inventory is not there anymore as well as inventory overall. I expect the feeder cattle market to follow suit, although there will certainly be a lag. My question is how long the packers will pay for cattle before they start to do away with shifts at the plant thus lowering slaughter volume. Packers will operate at a loss for a while, so if the wholesale/retail prices keep up we may not see any adjustment to the slaughter volume very soon. Not to manipulate the market anyway. Any adjustments in the near future will most likely be from volume.

I am cautious about getting too excited. The current futures run is not a “healthy” one and I would fully expect a correction of some sort, at some time. However, I don’t think it will be a strong correction and we should be enjoying strong fed prices for a while. I am more optimistic toward feeder prices. I personally think we will see strong performance in that area. Pay attention to how the summer video auctions do and get ready for fall.

Lastly, I think that fall calving operations or winter backgrounders and feeders who are selling this summer should be considering LRP. Those looking at the fall calf crop should certainly get an application in so that they can lock in prices as they rise.

Grain Market Report

Overall, the last two weeks corn prices have ended about where they started. There has been volatility in the market, but most seem optimistic that corn prices will not rise too much this year as we look to new crop going in to ground that has had sufficient winter moisture. Soybeans are up slightly and followed a similar rise and fall over the last few weeks. It seems that the soybean market is still waiting for China to return to more normal import volume.

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Sheep Market Report

San Angelo was steady to $5 better. Goldthwaite, Hamilton and Fredericksburg were off $10-20 however and New Holland was off $25-40. The USDA estimated domestic lamb and mutton meat production for the week ending April 1st totaled 2.51 million pounds on a 38,000 head slaughter this week compared to 2.48 million pounds and 37,000 head the previous week. Imported lamb and mutton meat for the week ending March 25th totaled 8.55 million pounds which is 345 percent of the domestic production for the same period.

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Hay Market Report

The hay market has been mostly quiet. Weather has kept much from happening, and there is some concern about how soon farmers can get into their fields in a lot of the west. Many won’t want to start until they know the flooding risk has passed. Dairies are still slow and over all quality is lower. Exports are also low.