Cattle and Beef Market Outlook

Derrell S. Peel Breedlove Professor of Agribusiness and Extension Livestock Marketing Specialist

Oklahoma State University

2015 Market Setting

• Global • U.S. Economy • Agriculture • Cattle Industry

Major Beef Market Factors

• Cattle Inventory and Beef Production • Beef Demand • International Trade • Feed and Input Markets • Forage Conditions

C-P-49A10/26/15

120

170

220

270

320

370

JAN APR JUL OCT

$ Per Cwt.

MED. & LRG. #1 STEER CALF PRICES 400-500 Pounds, Southern Plains, Weekly

Avg. 2009-13 2014 2015

Data Source: USDA-AMS, Compiled & Analysis by LMIC

Livestock Marketing Information Center

C-P-4910/26/15

100

120

140

160

180

200

220

240

260

JAN APR JUL OCT

$ Per Cwt.

MED. & LRG. #1 FEEDER STEER PRICES 700-800 Pounds, Southern Plains, Weekly

Avg. 2009-13 2014 2015

Data Source: USDA-AMS, Compiled and Analysis by LMIC

Livestock Marketing Information Center

Steer Price, Total Value and Value of Gain October 28, 2015, El Reno, Oklahoma

Weight (lbs)

Average Price ($/cwt.)

Total Value ($/hd)

VOG 400 lb. Beg. Weight ($/lb.)

VOG 450 lb. Beg. Weight ($/lb

VOG 500 lb. Beg. Weight ($/lb.)

VOG 550 lb. Beg. Weight ($/lb.)

VOG 600 lb. Beg. Weight ($/lb.)

VOG 650 lb. Beg. Weight ($/lb.)

400 $258.86 $1,035 450 $239.56 $1,078 $0.85 500 $225.82 $1,129 $0.94 $1.02 550 $214.83 $1,182 $0.97 $1.04 $1.05 600 $208.21 $1,249 $1.07 $1.14 $1.20 $1.35 650 $203.91 $1,325 $1.16 $1.24 $1.31 $1.44 $1.52 700 $199.70 $1,398 $1.21 $1.28 $1.34 $1.44 $1.49 $1.45 750 $197.07 $1,478 $1.26 $1.33 $1.40 $1.48 $1.53 $1.53 800 $193.80 $1,550 $1.29 $1.35 $1.40 $1.48 $1.51 $1.50 850 $190.67 $1,621 $1.30 $1.36 $1.40 $1.46 $1.49 $1.48 900 $186.51 $1,679 $1.29 $1.33 $1.37 $1.42 $1.43 $1.41

JANUARY 1 BEEF COW INVENTORYU.S., Annual

28

30

32

34

36

38

40

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

Mil. Head

Analysis by Derrell Peel Data Source: USDA-NASS

24 Dec 2014

U.S. Cattle Inventory July 1

2014 2015 % Change

1000 Head 1000 Head

All Cattle and Calves 96300 98400 +2.2

Beef Cows 29750 30500 +2.5

Dairy Cows 9250 9300 +0.5

Beef Replacements 4600 4900 +6.5

Dairy Replacements 4100 4200 +2.4

Other Heifers (500+ lbs.) 6900 6800 -1.4

Steers (500+ lbs.) 13700 14100 +2.9

Bulls (500+ lbs.) 1900 1900 0.0

Calves (<500 lbs.) 26100 26700 +2.3

Calf Crop 33900 34300 +1.2

Cattle on Feed 11900 12100 +1.7

Feeder Supply 34871 35500 +1.8

C-N-3707/24/15

4.0

4.5

5.0

5.5

6.0

1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Mil. Head

HEIFERS HELD AS BEEF COW REPLACEMENTS July 1, U.S.

Data Source: USDA-NASS

Livestock Marketing Information Center

+6.5 %

C-N-3207/24/15

30

35

40

45

50

55

1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Mil. Head

JULY 1 FEEDER CATTLE SUPPLIES Residual, Outside Feedlots, U.S.

Data Source: USDA-NASS

Livestock Marketing Information Center

C-N-1010/23/15

9.5

9.7

9.9

10.1

10.3

10.5

10.7

10.9

11.1

11.3

11.5

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Mil. Head

CATTLE ON FEED US Total, Monthly

Avg. 2009/13 2014 2015

Data Source: USDA-NASS

Livestock Marketing Information Center

HEIFERS ON FEEDQuarterly

3000

3200

3400

3600

3800

4000

4200

4400

4600

JAN-MAR APR-JUN JUL-SEP OCT-DEC

1000 HeadAvg.2006/102011

2012

2013

2014

2015

M-S-0108/28/13Livestock Marketing Information Center

Data Source: USDA-NASS, Compiled & Analysis by LMIC

STEERS ON FEEDQuarterly

6200

6400

6600

6800

7000

7200

7400

7600

JAN-MAR APR-JUN JUL-SEP OCT-DEC

1000 HeadAvg.2006/102011

2012

2013

2014

2015

M-S-0108/28/13Livestock Marketing Information Center

Data Source: USDA-NASS, Compiled & Analysis by LMIC

Steer to Heifer Slaughter Ratio 12 month MA

1.401.501.601.701.801.902.002.102.202.30

01/0

1/70

01/0

1/72

01/0

1/74

01/0

1/76

01/0

1/78

01/0

1/80

01/0

1/82

01/0

1/84

01/0

1/86

01/0

1/88

01/0

1/90

01/0

1/92

01/0

1/94

01/0

1/96

01/0

1/98

01/0

1/00

01/0

1/02

01/0

1/04

01/0

1/06

01/0

1/08

01/0

1/10

01/0

1/12

01/0

1/14

C-N-0810/23/15

1.3

1.5

1.7

1.9

2.1

2.3

2.5

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Mil. Head

FEEDLOT PLACEMENTS US Total, Monthly

Avg. 2009/13 2014 2015

Data Source: USDA-NASS

Livestock Marketing Information Center

Monthly Placements and F.I. Steer and Heifer Slaughter 12 Month Moving Ave.

170018001900200021002200230024002500

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

1,00

0 H

ead

Plcmts Sltr

Cattle Slaughter Federally Inspected, 1000 Head

2014 % Change 2013 to

2014

% Change YTD

2014 to 2015

Most Recent 4 Weeks

YOY

Steers 15378 -3.9 -2.0 +7.8

Heifers 8378 -8.3 -13.2 -16.0

Dairy Cows 2816 -9.9 +3.7 +6.1

Beef Cows 2565 -18.1 -14.9 -3.1

Bulls 548 -1.7 -15.5 -8.1

Total 29684 -7.1 -5.9 -0.5

Data through October 17, 2015

C-S-1810/23/15

810

830

850

870

890

910

930

950

JAN APR JUL OCT

Pounds

STEER DRESSED WEIGHT Federally Inspected, Weekly

Avg. 2009-13 2014 2015

Data Source: USDA-AMS & USDA-NASS

Livestock Marketing Information Center

Steer and Bull Carcass Weights, lbs.

750775800825850875900925950975

1000

Bull Steer

C-P-5210/26/15

85

95

105

115

125

135

145

155

165

175

185

JAN APR JUL OCT

$ Per Cwt.

SLAUGHTER STEER PRICES Southern Plains, Weekly

Avg. 2009-13 2014 2015

Data Source: USDA-AMS

Livestock Marketing Information Center

C-P-6210/26/15

140

160

180

200

220

240

260

280

JAN APR JUL OCT

$ Per Cwt.

BOXED BEEF CUTOUT VALUE Choice 600-900 Lbs., Carcass, Weekly

Avg. 2009-13 2014 2015

Data Source: USDA-AMS

Livestock Marketing Information Center

RETAIL BEEF PRICEMonthly

350375400425450475500525550575600625650

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

$ Per Cwt

All Fresh

Choice

Livestock Marketing Information Center Data Source: USDA-AMS & USDA-NASS, Compiled & Analysis by LMIC

U.S. Beef Exports 2014

(1000 lbs.) % Change 2013

to 2014 % Change YTD 2014 to 2015

Japan 662460 -1.3 -12.3 Mexico 435137 +7.9 -22.6 Hong Kong 415895 +16.0 -29.6 Canada 364374 -22.2 -12.8 S. Korea 301257 +19.2 +9.7

Total 2572740 -0.7 -11.8

*January-August

U.S. Beef Imports 2014

(1000 lbs.) % Change 2013

to 2014 % Change YTD 2014 to 2015*

Australia 1082554 +73.5 +53.1 Canada 602063 +11.9 +6.2 New Zealand 596939 +13.5 +17.0 Mexico 310236 +23.3 +34.6 Nicaragua 139028 +52.1 +3.1

Total 2946827 +31.0 +31.9

*January-August

Meat Production and Consumption

Production Consum. Per Capita

Consum. Change

2013 2014 2015 2014-2015

2016 2015- 2016

2015 2014-2015

Million lbs.

Million lbs.

Million lbs.

% Change

Million lbs.

% Change

Retail Lbs. %

Beef 25720 24252 23740 -2.1 24577 +3.5 54.8 +1.1 Pork 23187 22843 24555 +7.5 24565 0.0 49.7 +6.4 Broilers 37425 38137 39871 +4.5 40823 +2.4 88.9 +6.7

BEEF PRODUCTION vs. BEEF COW INVENTORY

Inventory on January 1, U.S.

28293031323334353637

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

Livestock Marketing Information Center Data Source: USDA-NASS, Compiled & Analysis by LMIC and Derrell Peel

2015-2017 Forecast

C-P-0610/05/15

50

75

100

125

150

175

200

225

250

275

1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017

$ Per Cwt

AVERAGE ANNUAL CATTLE PRICES Southern Plains

500-600lb Steer Calves 700-800lb Feeder Steers Fed Steers

Data Source: USDA-AMS, Compiled and Forecasts by LMIC

Livestock Marketing Information Center

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