October 12, 2018 Tennessee Market Highlights Number: 41

FED CATTLE: Fed cattle traded steady com-pared to last week on a live basis. Prices on a live basis were mainly $110 to $111 while prices on a dressed basis were mainly $173 to $174. The 5-area weighted average prices thru Thursday were $110.63 live, up $0.07 from last week and $173.76 dressed, down $1.06 from a week ago. A year ago prices were $111.05 live and $174.96 dressed. Finished cattle continued trading steady for the fifth consecutive week. Early in this trend, one might say this was beneficial for cattle feeders as they were able to hold packers at bay and keep prices from falling. However, some concern may be creeping in from the cattle feeding side as cattle feed-ers should be seasonally gaining some lev-erage on packers. Generally speaking, the price moves in the direction favorable to the one who holds the leverage. The steady prices again this week may mean cattle feeders are not gaining leverage as would be expected. There is no reason to abandon ship at this juncture, but if prices continue to be steady or decline in the next few weeks then there will be considerable dis-cussion points. BEEF CUTOUT: At midday Friday, the Choice cutout was $202.89 up $0.38 from Thurs-day and down $0.78 from last Friday. The Select cutout was $193.18 up $0.69 from Thursday and up $1.21 from last Friday. The Choice Select spread was $9.71 compared to $11.70 a week ago. The August Restaurant Performance Index (RPI) was released at the end of September. This index is a monthly index that attempts to track the health and outlook of the U.S. restaurant industry. The RPI in August was 102.0 which is an increase of nearly 1 per-cent from the previous month. This would indicate a positive movement in the indus-try given that any value greater than 100 indicates a period of expansion. The RPI is not necessarily the most robust value to

consider when thinking about beef prices alone, but what it does do extremely well is provides an idea of how consumers are spending some of their discretionary in-come. When consumers are consuming more meals away from home then it is ex-pected that there is an increase in discre-tionary spending and some of that is filter-ing into the beef industry. Despite this one index not providing a complete picture of the beef industry, it would appear the in-formation in it supports the strength in the beef market. Demand is strong, and con-sumers with more income purchase beef. OUTLOOK: Fall temperatures arrived this week in the Southeastern United States as well as some rain that was tremendously beneficial for some areas and could have been devastating for others. Trying to look at the positive aspect of the overall weath-er conditions, adequate fall moisture and favorable temperatures should support significant fall forage production. This for-age can result in grazing the cow herd later before feeding harvested feeds or poten-tially providing a nice forage base for wean-ing and backgrounding freshly weaned calves. As expected, lightweight calf prices are slowly declining as the market moves through the month of October. However, prices are not declining as rapidly as is the seasonal tendency. If prices were declining to a great extent then that would provide more reason to wean and precondition calves this fall and winter, but the decision is made more difficult with relatively strong calf prices. The expectation of relatively inexpensive forage makes the decision more difficult. Understanding that cost of gain is highly variable across producers and production systems then it is difficult to discuss it thoroughly. However, most pro-ducers using grass will have a cost of gain between $0.40 and $0.60 per pound of gain. Value of gain is not an exact science, but it is a little easier. The current value of gain for adding 100 pounds of weight to

(Continued on page 2)

Livestock Comments by Dr. Andrew P. Griffith Trends for the Week Compared to a Week Ago

Slaughter Cows

$1 lower

Slaughter Bulls

$1 lower

Feeder Steers

$1 to $3 lower

Feeder Heifers

$1 to $5 lower

Feeder Cattle Index

Wednesday’s index: 158.37

Fed Cattle

The 5-area live price of $110.63 was up $0.07. The dressed price of $173.76 was down $1.06.

Corn

December closed at $3.73 a bush-el, up 5 cents since last Friday.

Soybeans

November closed at $8.67 a bush-el, down 2 cents since last Friday.

Wheat

December closed at $5.17 a bush-el, down 4 cents since last Friday.

Cotton

December closed at 78.37 cents per lb, up 2.27 cents since last Fri-day.

2

steers starting from 475 pounds to 625 pounds ranges from $1.02 to $1.24 per pound of gain if prices are locked in today and no value added premium added. Similarly, adding 150 pounds of weight to steers of the same weight categories has a value of gain ranging from $1.04 to $1.15 per pound of gain with no price premium and prices locked. Feasibly, weaning and vaccinating and putting a group of calves together should garner a price premium which is not added in the value of gain calculation. Additionally, the value of gain is not guaranteed unless some form of price protection is utilized. This is a tough decision for many producers, but pencil and paper can go a long way in helping. ASK ANDREW, TN THINK TANK: The Northeast Tennessee Beef Expo was held this week in Greeneville, Tennessee with approx-imately 400 producers in attendance. This speaking opportunity provided me an opportunity to visit with several producers who had many good questions. One of the questions was in relation to marketing slaughter cows in the fall following calf weaning and the risk of carrying those animals through the winter. There are risks all times of the year in the cattle business and there is significant risk of a poor outcome when carrying unthrifty cows through the winter. This may be a tough pill to swallow but most breeding stock should be moved out of the breeding herd before they become so poor that there is increased risk of death loss through the winter. If these animals do exist in fu-ture years then marketing them in August and early weaning a calf may be the best option to avoid the seasonally low prices in October. Please send questions and comments to agriff14@utk.edu or send a letter to Andrew P. Griffith, University of Tennessee, 314B Morgan Hall, 2621 Morgan Circle, Knoxville, TN 37996. FRIDAY’S FUTURES MARKET CLOSING PRICES: Friday’s closing prices were as follows: Live/fed cattle –October $112.33 -0.30; December $116.18 -0.60; February $120.40 -0.85 Feeder cattle –October $154.70 -2.03; November $154.63 -2.13; January $149.75 -1.75; March $148.98 -1.63; December corn closed at $3.74 up $0.05 from Thursday.

(Continued from page 1)

Livestock Comments by Dr. Andrew Griffith

Thursday, October 11, 2018

Month Class III Close Class IV Close

Oct 15.66 15.07

Nov 15.76 15.09

Dec 15.80 15.00

Jan 15.75 14.92

Feb 15.73 15.03

Milk Futures

Cattle Hogs

———— Number of head ————

This week (4 days) 117,000 465,500

Last week (4 days) 119,500 462,250

Year ago (4 days) 117,750 461,250

This week as percentage of

Week ago (%) 98% 101%

Year ago (%) 99% 101%

Average Daily Slaughter USDA Box Beef Cutout Value

Choice 1-3 600-900 lbs

Select 1-3 600-900 lbs

———————— $/cwt —-———————

Thursday 202.51 192.49

Last Week 203.86 191.98

Year ago 196.32 188.76

Change from week ago -1.35 +0.51

Change from year ago +6.19 +3.73

3

Crop Comments by Dr. Aaron Smith

Overview Corn and cotton were up and soybeans and wheat were down for the week.

On Thursday, the USDA released the October Crop Production and WASDE reports. After the report corn and soybean prices were up cotton and wheat were neutral to slightly down.

U.S. corn production was projected at 14.8 billion bushels, up 1% compared to last year. National average yield was projected at an all-time record of 180.7 bu/acre, down 0.6 bu/acre compared to the September estimate. Tennessee corn yield was projected at 174 bu/acre unchanged compared to last month.

U.S. soybean production was projected at 4.7 billion bushels, up 6% compared to last year. National average yield was projected at an all-time record of 53.1 bu/acre, up 0.3 bu/acre compared to the September estimate. Tennessee soybean yield was projected at 50 bu/acre, down 1 bu/acre compared to last month.

U.S. upland cotton production was projected at 18.992 million bales, down 6% compared to last year. National average yield was projected at 887 lbs/acre, up 7 lbs/acre compared to the September estimate. Tennessee cotton yield was projected at 1,034 lbs/acre, down 48 lbs/acre compared to last month.

A summary of the WASDE report for corn, cotton, soybeans, and wheat is available on line at: https://ag.tennessee.edu/arec/Pages/MonthlyCropComments.aspx.

Cotton prices rallied at the end of the week due to anticipated production losses in Georgia, Florida, and the Carolinas due to hurri-cane Michael.

Corn

Across Tennessee, average corn basis (cash price-nearby futures price) strengthened or remained unchanged at Memphis, North-west, Upper-middle, and Lower-middle Tennessee and weakened at Northwest Barge Points. Overall, basis for the week ranged from 31 under to 2 over the December futures contract with an average of 22 under at the end of the week. December 2018 corn futures closed at $3.73, up 5 cents since last Friday. For the week, December 2018 corn futures traded between $3.60 and $3.74. Corn net sales reported by exporters from September 28 to October 4 were within expectations with net sales of 39.6 million bush-els for the 2018/19 marketing year. Exports for the same time period were up 14% compared to last week at 63.2 million bushels. Corn export sales and commitments were 33% of the USDA estimated total annual exports for the 2018/19 marketing year (September 1 to August 31) compared to a 5-year average of 31%. Ethanol production for the week ending October 5 was 1.040 million barrels per day, up 25,000 from the previous week. Ethanol stocks were 24.021 million barrels, up 576,000 barrels. Dec/Mar and Dec/Dec future spreads were 12 and 31 cents, respectively.

The Crop Progress report estimated corn condition at 68% good-to-excellent and 12% poor-to-very poor; corn mature at 93% com-pared to 86% last week, 80% last year, and a 5-year average of 83%; and corn harvested at 34% compared to 26% last week, 21% last year, and a 5-year average of 26%. In Tennessee, corn condition was estimated at 80% good-to-excellent and 2% poor-to-very poor; corn mature at 98% compared to 97% last week, 97% last year, and a 5-year average of 97%; and corn harvested at 79% com-pared to 64% last week, 83% last year, and a 5-year average of 78%. In Tennessee, January 2019 corn cash forward contracts aver-aged $3.80 with a range of $3.64 to $3.97. March 2019 corn futures closed at $3.85, up 5 cents since last Friday. December 2019

(Continued on page 4)

4

Crop Comments by Dr. Aaron Smith

corn futures closed at $4.04, up 4 cents since last Friday. Downside price protection could be obtained by purchasing a $4.10 De-cember 2019 Put Option costing 29 cents establishing a $3.81 futures floor.

Soybeans

Average soybean basis strengthened or remained unchanged at Memphis, Lower-middle, Upper-middle, and Northwest Tennessee and weakened at Northwest Barge Points. Basis ranged from 81 under to 28 under the November futures contract at elevators and barge points. Average basis at the end of the week was 56 under the November futures contract. November 2018 soybean futures closed at $8.67, down 2 cents since last Friday. For the week, November 2018 soybean futures traded between $8.47 and $8.74. Net sales reported by exporters were below expectations with net sales of 16.2 million bushels for the 2018/19 marketing year and 0.2 million bushels for the 2019/20 marketing year. Exports for the same period were up 23% compared to last week at 32.5 million bushels. Soybean export sales and commitments were 37% of the USDA estimated total annual exports for the 2018/19 marketing year (September 1 to August 31), compared to a 5-year average of 52%. Nov/Dec 2018 soybean-to-corn price ratio was 2.32 at the end of the week.

Nov/Jan and Nov/Nov future spreads were 14 and 65 cents, respectively. The Crop Progress report estimated soybean condition at 68% good-to-excellent and 10% poor-to-very poor; soybeans dropping leaves at 91% compared to 83% last week, 88% last year, and a 5-year average of 85%; and soybeans harvested at 32% compared to 23% last week, 34% last year, and a 5-year average of 36%. In Tennessee, soybean condition was estimated at 72% good-to-excellent and 5% poor-to-very poor; soybeans dropping leaves at 83% compared to 67% last week, 81% last year, and a 5-year average of 76%; and soybeans harvested at 30% compared to 18% last week, 27% last year, and a 5-year average of 26%. In Tennessee, January 2019 soybean cash contracts average $8.43 with a range of $8.32 to $8.52. January 2019 soybean futures closed at $8.81, down 1 cent since last Friday. November 2019 soy-bean futures closed at $9.32, down 3 cents since last Friday. Downside price protection could be achieved by purchasing a $9.40 November 2019 Put Option which would cost 59 cents and set an $8.81 futures floor. Nov/Dec 2019 soybean-to-corn price ratio was 2.31 at the end of the week.

Cotton

Delta upland cotton spot price quotes for October 11 were 75.56 cents/lb (41-4-34) and 77.31 cents/lb (31-3-35). Adjusted World Price (AWP) decreased 0.14 cents to 67.73 cents. Net sales reported by exporters were up from last week at 98,000 bales for the 2018/19 marketing year and 142,900 for the 2019/20 marketing year. Exports for the same time period were 208,400 bales, up 16% from last week. Upland cotton export sales were 63% of the USDA estimated total annual exports for the 2018/19 marketing year (August 1 to July 31), compared to a 5-year average of 45%.

The Crop Progress report estimated cotton condition at 42% good-to-excellent and 25% poor-to-very poor; cotton opening bolls at 78% compared to 67% last week, 71% last year, and a 5-year average of 74%; and cotton harvested at 25% compared to 19% last week, 24% last year, and a 5-year average of 18%. In Tennessee, cotton condition was estimated at 73% good-to-excellent and 8% poor-to-very poor; cotton bolls opening at 96% compared to 95% last week, 91% last year, and a 5-year average of 80%; and cotton harvested at 33% compared to 14% last week, 21% last year, and a 5-year average of 13%. December 2018 cotton futures closed at 78.37, up 2.27 cents since last Friday. For the week, December 2018 cotton futures traded between 76.15 and 78.88 cents. Dec/Mar and Dec/Dec cotton futures spreads were 1.18 cents and -1.38 cents, respectively. March 2019 cotton futures closed at 79.55, up 2.41 cents since last Friday. December 2019 cotton futures closed at 76.99, up 1.24 cents since last Friday. Downside price pro-

(Continued on page 5)

5

Crop Comments by Dr. Aaron Smith

tection could be obtained by purchasing a 77 cent December 2019 Put Option costing 4.84 cents establishing a 72.16 cent futures floor.

Wheat

Wheat net sales reported by exporters were within expectations with net sales of 12.4 million bushels for the 2018/19 marketing year. Exports for the week were up 58% compared to last week at 18.4 million bushels. Wheat export sales were 42% of the USDA estimated total annual exports for the 2018/19 marketing year (June 1 to May 31), compared to a 5-year average of 61%. The Crop Progress report estimated winter wheat planted at 57% compared to 43% last week, 46% last year, and a 5-year average of 54%; and winter wheat emerged at 30% compared to 14% last week, 23% last year, and a 5-year average of 28%. In Tennessee, winter wheat planted was estimated at 17% compared to 11% last week, 16% last year, and a 5-year average of 13%; and winter wheat emerged at 9% compared to 6% last week, 3% last year, and a 5-year average of 2%.

December 2018 wheat futures closed at $5.17, up 4 cents since last Friday. December 2018 wheat futures traded between $5.06

and $5.25 this week. December wheat-to-corn price ratio was 1.39. Dec/Mar and Dec/Jul future spreads were 20 cents and 38 cents, respectively. March 2019 wheat futures closed at $5.37, down 3 cents since last Friday. In Tennessee, June/July 2019 wheat cash contracts ranged from $5.28 to $5.62 for the week. July 2019 wheat futures closed at $5.55, unchanged since last Friday. Downside price protection could be obtained by purchasing a $5.60 July 2019 Put Option costing 39 cents establishing a $5.21 fu-tures floor.

Additional Information: Links for data presented: U.S. Export Sales - https://apps.fas.usda.gov/export-sales/esrd1.html USDA FAS: Weekly Export Performance Indicator – https://apps.fas.usda.gov/esrquery/esrpi.aspx EIA: Weekly ethanol Plant Production - https://www.eia.gov/dnav/pet/pet_pnp_wprode_s1_w.htm EIA: Weekly Supply Estimates - https://www.eia.gov/dnav/pet/pet_sum_sndw_a_EPOOXE_sae_mbbl_w.htm Upland Cotton Reports - https://www.fsa.usda.gov/FSA/epasReports?area=home&subject=ecpa&topic=fta-uc Tennessee Crop Progress - https://www.nass.usda.gov/Statistics_by_State/Tennessee/Publications/Crop_Progress_&_Condition/ U.S. Crop Progress - http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1048 USDA AMS: Market News - https://www.ams.usda.gov/market-news/search-market-news

If you would like further information or clarification on topics discussed in the crop comments section or would like to be added to our free email list please contact me at aaron.smith@utk.edu.

6

Friday, October 5, 2018 — Thursday, October 11, 2018

Commodity Contract Month Friday Monday Tuesday Wednesday Thursday

Soybeans Nov 8.69 8.69 8.63 8.52 8.58

($/bushel) Jan 8.82 8.83 8.76 8.66 8.72

Mar 8.94 8.94 8.89 8.78 8.85

May 9.07 9.07 9.02 8.92 8.98

Jul 9.19 9.18 9.14 9.03 9.10

Aug 9.23 9.23 9.18 9.08 9.14

Corn Dec 3.68 3.66 3.64 3.62 3.69

($/bushel) Mar 3.80 3.78 3.76 3.74 3.81

May 3.87 3.85 3.83 3.82 3.88

Jul 3.92 3.90 3.89 3.87 3.94

Sep 3.95 3.94 3.92 3.91 3.97

Dec 4.00 3.99 3.97 3.96 4.02

Wheat Dec 5.21 5.14 5.15 5.10 5.08

($/bushel) Mar 5.40 5.34 5.35 5.31 5.29

May 5.50 5.44 5.46 5.43 5.41

Jul 5.55 5.49 5.52 5.48 5.48

Sep 5.68 5.62 5.64 5.60 5.60

Soybean Meal Oct 315 314 313 312 312

($/ton) Dec 319 318 317 315 316

Jan 319 318 318 316 317

Mar 318 317 316 314 316

May 316 315 314 312 314

Jul 317 316 315 312 314

Cotton Oct 76.49 77.94 77.40 ——— ———

(¢/lb) Dec 76.10 77.55 77.01 76.80 76.81

Mar 77.14 78.49 78.07 78.04 78.17

May 77.95 79.21 78.89 78.86 79.03

Jul 78.71 79.84 79.54 79.52 79.66

Live Cattle Oct 113.80 114.17 113.35 112.07 112.62

($/cwt) Dec 118.15 118.25 117.15 116.47 116.77

Feb 122.52 122.87 122.10 121.45 121.25

Apr 123.60 123.72 123.00 122.67 122.52

Jun 116.65 116.95 116.25 115.70 115.67

Feeder Cattle Oct 157.77 157.67 156.95 155.90 156.72

($/cwt) Nov 158.22 158.42 157.50 156.17 156.75

Jan 154.37 154.82 153.75 152.12 151.50

Mar 153.45 153.65 152.55 151.35 150.60

Apr 153.97 154.17 153.07 152.00 151.37

May 153.85 153.87 152.82 151.72 151.25

Market Hogs Oct 68.20 68.45 68.75 68.47 68.67

($/cwt) Dec 57.55 57.55 56.57 55.95 54.42

Feb 66.65 67.20 65.62 64.52 62.42

Apr 71.15 71.85 71.12 70.42 68.80

May 76.05 76.50 75.80 75.42 74.15

Futures Settlement Prices: Crops & Livestock

7

Cattle Receipts: This week: 8,660 (9) Week ago: 10,064 (10) Year ago: 8,010 (11)

This Week Last Week Year Ago

Low High Weighted Average Weighted Average Weighted Average

—————————————————————— $/cwt ——————————————————————

Steers: Medium/Large Frame #1-2

300-400 lbs 136.00 181.00 162.37 164.62 157.50

400-500 lbs 130.00 173.00 155.00 158.28 150.51

500-600 lbs 124.00 163.00 148.36 150.28 142.36

600-700 lbs 128.00 153.00 142.01 142.38 137.57

700-800 lbs 120.00 146.00 138.90 139.42 134.70

Steers: Small Frame #1-2

300-400 lbs ——— ——— ——— 152.16 141.06

400-500 lbs 125.00 137.50 131.75 134.45 129.37

500-600 lbs 120.00 125.00 122.92 128.81 129.95

600-700 lbs ——— ——— ——— 133.48 ———

Steers: Medium/Large Frame #2-3

300-400 lbs 135.00 160.00 147.92 150.72 142.41

400-500 lbs 122.50 152.00 141.28 141.85 142.58

500-600 lbs 124.00 145.00 135.46 139.15 129.74

600-700 lbs 120.00 140.50 129.50 131.46 122.82

700-800 lbs 112.00 130.00 122.96 130.72 123.22

Holstein Steers

300-400 lbs ——— ——— ——— ——— ———

500-600 lbs ——— ——— ——— ——— 77.15

700-800 lbs ——— ——— ——— ——— ———

Slaughter Cows & Bulls

Breakers 75-80% 41.50 46.04 47.03 51.91 54.00

Boners 80-85% 47.47 48.29 55.33 42.00 54.50

Lean 85-90% 35.00 51.00 42.13 43.12 47.57

Bulls YG 1 65.00 78.50 71.86 72.23 73.42

Heifers: Medium/Large Frame #1-2

300-400 lbs 114.00 158.00 140.04 144.76 135.03

400-500 lbs 118.00 150.00 134.52 137.61 132.59

500-600 lbs 110.00 145.00 129.32 131.31 126.53

600-700 lbs 110.00 138.00 124.95 128.50 125.70

Heifers: Small Frame #1-2

300-400 lbs 120.00 130.00 124.07 128.20 ———

400-500 lbs 107.50 130.00 119.63 121.60 118.83

500-600 lbs 112.50 121.00 118.33 115.52 115.00

600-700 lbs ——— ——— ——— ——— ———

Heifers: Medium/Large Frame #2-3

300-400 lbs 110.00 150.00 131.15 132.07 124.24

400-500 lbs 111.00 135.00 125.29 127.84 120.40

500-600 lbs 108.00 131.00 123.52 121.54 116.94

600-700 lbs 110.00 127.00 117.25 119.64 113.72

Prices on Tennessee Reported Livestock Auctions for the week ending October 12, 2018

8

Friday, October 5, 2018 — Thursday, October 11, 2018

Friday Monday Tuesday Wednesday Thursday

Low High Low High Low High Low High Low High

———————–——————————————— $/bushel ———————————————————–———

No. 2 Yellow Soybeans

Memphis 8.27-8.31 ——— 8.21-8.25 8.10-8.24 8.16-8.30

N.W. B.P. 8.21-8.24 ——— 8.10-8.15 8.00-8.02 8.03-8.07

N.W. TN 7.88-7.94 ——— 7.82-7.99 7.72-7.93 7.30-7.83

Upper Md. 8.09-8.19 ——— 8.11-8.17 8.03-8.08 8.08-8.13

Lower Md. ——— ——— ——— ——— ———

Yellow Corn

Memphis 3.58-3.63 ——— 3.58-3.59 3.57-3.64 3.62-3.71

N.W. B.P. 3.55-3.56 ——— 3.52-3.55 3.47-3.53 3.46-3.53

N.W. TN 3.43-3.52 ——— 3.34-3.56 3.37-3.54 3.44-3.52

Upper Md. 3.38-3.41 ——— 3.34-3.38 3.32-3.35 3.38-3.42

Lower Md. ——— ——— ——— ——— ———

Wheat

Memphis ——— ——— ——— ——— ———

Prices Paid to Farmers by Elevators

100

120

140

160

180

200

220

Tennessee 500-600 lbs. M-1 Steer Prices2017, 2018 and 5-year average

2012/2016 Avg 2017 2018

85

105

125

145

165

185

Tennessee 700-800 lbs. M-1 Steers Prices2017, 2018 and 5-year average

2012/2016 Avg 2017 2018

8595

105115125135145155

5-Area Finished Cattle Prices2017, 2018 and 5-year average

2012/2016 Av g 2017 2018

35455565758595

105

Tennessee Slaughter Cow PricesBreakers 75 -80%

2017, 2018 and 5-year average

1.00 2017 2018

9

East Tennessee Livestock Center, Sweetwater, TN Graded Feeder Sale Weighted Average Report for Friday Oct 5, 2018 Cattle Receipts: 354 For complete report: https://www.ams.usda.gov/mnreports/nv_ls183.txt Lower Middle Tennessee Cattlemens Video Board Sale Feeder Cattle Weighted Average Report for 10/05/2018 Receipts: 1370 For complete report: https://www.ams.usda.gov/mnreports/nv_ls184.txt Mid-South Livestock Center - October 8, 2018 1 load of 69 steers; M&L1-2s; avg. wt. 745 lbs.; $156.75

10/09/2018 TN Livestock Producers Fayetteville Receipts: 476 (209 graded & grouped) Steers: Med & Lg 1-2 Heifers: Med & Lg 1-2 300-400 lbs 145.00 300-400 lbs 130.00-134.00 400-500 lbs 156.00 400-500 lbs 127.00-137.00 500-600 lbs 136.00-148.00 500-600 lbs 119.50-129.00 600-700 lbs 130.00-139.00 600-700 lbs 116.00-125.00 700-800 lbs 134.00-137.50 700-800 lbs 100.00-115.00 800-900 lbs 123.00 Bulls: Med & Lg 1-2 400-500 lbs 146.00-150.00 500-600 lbs 134.00-144.00 600-700 lbs 121.00-125.00 700-800 lbs 114.00

Graded Sales, Video Board Sales, Video Sales & Loads Self-Reported and Self-Graded Markets

Self-Reported and Self-Graded Markets

10

Grazing in Southern Plains Expected To Increase on Small Grain Pasture

Livestock Marketing Information Center October 11, 2018

In the late 1990’s requests were made of USDA’s National Agri-cultural Statistics Service (NASS) to develop a survey to meas-ure the number of steers and heifers being grown on pastures during in the winter months. The result was a scaled-down effort focusing on the key small grain grazing in three states, Texas, Oklahoma, and Kansas that was first reported in the January 1, 2001, annual Cattle report.

The bulk of that grazing occurs on wheat in southern Kansas into central Oklahoma and blended pastures (e.g., wheat and rye) southern Oklahoma into Texas. In Texas, there is extensive grazing of winter oats and similar crops. Many of the wheat pastures are dual purpose (grazed beginning in midfall into the winter months) and then subsequently harvested for grain.

Over the last 18 years, the number of cattle reported in the 3-state grazing total on small grain pastures as of January 1st has been quite variable. The average was about 2.1 million head. However, that total has not exceeded 2 million animals since 2007’s count. The maximum was 3.70 million (2003), and the minimum was 1.34 million (2013). As of January 1, 2018, there were 1.50 million head, the lowest since 2013. In 2016 and 2017, there were 1.90 and 1.80 million head, respectively.

The 3-state January 1 count over the last four years has repre-sented between 4.2% (2018) and 5.8% (2015) of the U.S. prior year calf crop. In this year’s mid-year survey, NASS has a pre-liminary 2018 calf crop of 36.5 million, a year-over-year in-crease of 692,000 head (1.9%). That’s the largest since 2007, and as noted above that was the last time the 3-state survey reported over 2 million cattle.

Although no animals have even been placed yet onto Southern Plains wheat pastures, as indicated in the prior article, condi-tions currently are quite favorable. Additionally, the cost and return estimates look positive, though that can change quickly. Cattle moving through winter grazing in the 3-state region could be well above last year’s. As of January 1, 2019, the 3-state total could be 1.8 to 2.0 million head. At that midpoint (1.9 million head), it would indicate the number of head winter grazing has increased from the prior year by 400,000 head (up

Beef Industry News Featured Article from DROVERS

27%). That number would go a long way in absorbing the growth in this year’s national calf crop, but it may also bunch-up sales of short yearling animals coming of those pastures as early as mid-February.

Department of Agricultural and Resource Economics 314 Morgan Hall • 2621 Morgan Circle

arec.tennessee.edu USDA / Tennessee Department of Agriculture Market News Service http://www.tennessee.gov/agriculture/article/ag-farms-market-news 1-800-342-8206