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Deb’s Outlook – for Mar. 9, 2009

Fed Cattle

While feedlots locally are reasonably current, the fed supply south of the border is seasonally ample for the near term. Through March in North America the front end supply of market ready fed cattle should tighten. Beef sales have struggled to date in 2009 however historically beef demand picks up as barbeque season approaches. Both tight supplies and potential for increased beef demand are supporting factors to the market in the coming month however, the soft economy and uncertain financial markets will likely continue to weigh in on the fed cattle market.

Feeder Cattle

Demand for grass cattle in the coming month will continue to be good particularly if spring weather is wet and buyers get more excited about the coming pasture conditions. Cattle numbers is Canada are smaller than in previous years, the smaller supply of feeder cattle domestically as well as reduced number in the U. S. will support the feeder cattle market. Exports of feeder cattle to the U. S. are fewer this year compared with last. It is expected that the reduced feeder supply and weaker Canadian dollar will increase U. S. buyer interest as feedlots south of the border become more comfortable with the COOL rules. Feeder sellers should be cautiously optimistic for continued strength in the spring feeder market.

Cull Cattle

The volume of cull cattle available for slaughter generally starts to taper off as cow calf producers get heavy into calving season. Seasonally cull prices continue to improve heading into March. As late spring and early summer approach cull cow prices typically reach the annual highs, this is when the smallest supply of cows is available. Domestic demand will remain strong for grinding and trim as well as demand for exported cull cattle. The smaller U. S. cow herd coupled with consumers looking to more inexpensive cuts of meat will keep U. S. buyers looking north to help meet their domestic demand.

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