Sort & Cull

The relationship between formula-based cash cattle and negotiated cattle trade indicates the dynamic relationships in the industry. Significant formula premiums have quickly eroded over the last month as slaughter numbers have ramped up to pre-COVID-19 levels.

Understanding what tools to use, and when, can yield great insight into the cattle market.

The recent spur in live cattle contracts couldn't seem more baffling as the market still faces vast numbers of fat cattle that need slaughtered, sees heavier carcass weights, and has concerns about the third quarter's boxed beef demand.

Slowly, the industry is making progress and we can celebrate the wins along the way. Last week's slaughter is estimated at 680,000 head -- the last time cattle slaughter exceeded 680,000 head was in late March.

With Superior Livestock Auction and Northern Livestock Auction hosting their early summer sales this week, the feeder cattle market is going to be tested.

Producers begin to look at summer sales while bearing the blow of a weakening cash cattle market.

As the market heads into summer, the hype of the coronavirus may be dying down, but its effects on the market are still alive and very evident.

Wholesale beef values seem to be returning to more realistic levels as prices continue to steadily fall from May highs.

Producers know that cash cattle prices weaken throughout the summer, but questions that still need answers revolve around the feeder cattle market and just how much cash cattle prices intend to regress.

As we wrap up May, keeping tabs on the fed cattle market is vital while also paying close attention to the early summer feeder cattle sales.

Although light support has slowly developed in the cash and futures cattle markets and beef cutout values have eroded from historic highs, a huge gap remains in market direction, driven by boxed beef prices.

Seeing that packers bought over 100,000 head of fat cattle last week, all for delivery in the next one to 14 days, raises some questions for the cash market in upcoming weeks.

While last week saw an exciting rally in prices, this week has begun with trade anywhere from $2.00 to $3.00 lower in both live cattle and feeder cattle contracts.

Last week was a week that will go down in history and, sadly, not in a good way.

The problems that the industry is currently facing are bigger than we feared and longer lasting than we'd like to admit. Getting packing plants up and running is critical for the beef industry.

Packers serve as a "bridge" between the livestock industry and consumers. The latest closures of packing and meat processing plants, due to outbreaks of coronavirus, have created a wide gap with limited ways to get meat from the farm to the dinner plate.

How we deal with the challenges before us will involve blending different strengths and attitudes of those who survived and learned from tough times in the past.

Last week, beef slaughter totaled 536,000 head -- 90,000 head less than the previous week and 102,000 head less than a year ago. It's essential to keep consumers' trust, but also to keep packing plants open and product moving to market.

Ranchers are used to challenges beyond their control, yet they realize they have go on about business in the most normal fashion possible.

Being the backbone of America is a lot of responsibility, hard work and sacrifice. Farmers, ranchers and others involved in agriculture continue to meet the challenge and earn a nation's gratitude.