Cattle and Beef Market Indicators All Green

Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist

 

For the first time in several years it appears that all segments of cattle and beef markets are on the same page and responding to tightening supply fundamentals.  The complex linkages across cattle and beef markets mean that the dynamics of market adjustments are relatively slow under the best of circumstances.  Delays due to the pandemic in 2020 stretched into 2021 and drought impacts since late 2020 contributed to a delayed transition of fundamentals from feeder cattle markets, through fed cattle markets into beef markets.

 

Cattle numbers have declined for several years since the peak beef cow herd in 2019.  Declining calf crop numbers (from the 2018 peak) should have led to peak cyclical beef production by 2020.  Pandemic delays pushed beef production from 2020 into 2021.  Drought liquidation in 2021 and 2022 led to further short-term increases in beef production.  Record beef production in 2022 occurred four years after the peak calf crop.  Drought the past two years resulted in additional heifer placements and caused early marketing of calves in 2022 that maintained feedlot inventories above year earlier levels until late in the year.  Feedlot inventories have declined year over year for five consecutive months and will continue decreasing.  Feedlot marketings and beef production were higher year over year in January but that appears to be changing.  

 

Lower carcass weights and declining cattle slaughter have year-to-date beef production down 4.5 percent by early March.  The decrease in cattle numbers since the 2018 peak calf crop has finally worked through the system.  Cattle slaughter and beef production are expected to decrease for the balance of 2023 and beyond.  With continuing drought conditions, it is not clear exactly how cattle and beef market timing will develop going forward, but the question is not one of whether beef production will fall, but rather how fast and how much it will fall in 2023.

 

The auction price for 500-pound steers in Oklahoma last week was $239.66/cwt., the highest price since September 2015.  The record high price for 500-pound steers in Oklahoma was $312.72/cwt. in November 2014.  The price of 825-pound steers last week was $181/cwt., the highest price since October 2015.  The all-time peak price for these steers was $238.87/cwt. in October of 2014. The live 5-market average price of fed steers last week was $165.07/cwt., the highest fed price since April of 2015.   Fed prices hit a record level of $171.38/cwt. in November 2014. Cattle prices are expected to continue trending higher in 2023 and new record cattle prices will happen, if not in 2023, at some point in the next two or three years.

 

Higher cattle prices will push wholesale and retail beef prices against beef demand, which remains strong but somewhat muted currently.  There will be resistance to higher beef prices, but the reality of decreasing beef supplies will ultimately push beef prices higher.  It will take some time for domestic and international demand to adjust to limited beef supplies.  In the meantime, all the margins between cow-calf and consumer will be squeezed.  The tightest pinch-point in this process will be when heifer retention begins in earnest to rebuild the herd.  That will likely begin in late 2023 and continue through 2024 and perhaps beyond.

 

Derrell Peel, OSU Extension livestock marketing specialist, says cattle markets are continuing to remain strong overall on SunUpTV.

 

Retained Placenta in Beef Cattle

Mark Z. Johnson, Oklahoma State University Extension Beef Cattle Breeding Specialist

 

Retention of fetal membranes, or retained placenta, in cows usually is defined is defined as failure to expel fetal membranes within 24 hours after parturition.  Normally the expulsion occurs within eight hours after delivery of the calf.   The placenta is retained when the cotyledons on the placenta do not detach from the caruncles on the uterus during parturition.  Although retained placenta is rare in most cow herds, this year I am hearing that producers are seeing a higher incidence of this problem.

 

Retained placenta creates the potential for problems.  It hangs from the vulva which permits manure and micro-organisms from the manure into the uterus.  As well, when the cow lays down in dirt or mud which is loaded with bacteria, it permits bacteria to cause infection in the uterus and can have serious negative consequences.  Infection in the uterus can cause the cow to become ill (fever, weight loss, etc).  In severe cases of infection the cow can actually die.  When the uterus becomes infected and inflamed, it takes longer for the cow to clean and be ready for the next breeding season.

 

Retained placentas can result in delayed rebreeding or cows coming up open at the end of breeding season.  Bottomline: retained placentas jeopardize reproductive efficiency and can rob operations of profit potential.

 

What follows is a list of the typical causes of retained placenta.

 

1. Dystocia, as a result of too large a calf, twins or abnormal presentation of the fetus, calving difficulty is a cause.
2. Poor nutrition.  Inadequate consumption of energy or protein during pregnancy can result in thin cows.  Dietary deficiency of Vitamin A, Selenium, Iodine or Vitamin E have been linked to retained placenta.  Retained placenta is most often associated with nutrition, in particular, low levels of Vitamin A or the mineral Selenium. 
3. Stress, obesity and genetics can play a role.
4. Infectious diseases like Brucellosis, Leptospirosis, IBR virus or BVD virus.

 

What are the best management practices to prevent retained placenta? Over time, proper nutrition, herd health and mineral supplementation should solve most the problems.  If not, consult your veterinarian.   

 

Why are we potentially seeing more retained placenta this year?  Many operations are feeding “non-traditional” hays over the past several months which may not be very green or leafy.  Typically the best source of vitamin A for cattle is green, leafy forage.  A good quality free choice mineral supplement containing Selenium is advised. Cows and heifers in Body Condition Scores of 5 to 6 at calving time is advised.  If you are dealing with sick cows as a result of retained placenta, consult your veterinarian for best treatment options.     

 

Reference: Vet Views. University of California-Davis. Dr. John Maas. 2008. 

 

Strong Premiums for Oklahoma Quality Beef Network Cattle in 2022

Kellie Curry Raper, Oklahoma State University Livestock Marketing Specialist

Derrell S. Peel, Oklahoma State University Livestock Marketing Specialist

 

Oklahoma Quality Beef Network producers in Fall 2022 enjoyed the second highest average premiums in program history. OQBN is a third-party certified VAC-45 preconditioning program offered through Oklahoma Cooperative Extension. Extension Specialists guide producers through the calf health management protocol to qualify for certification and eligibility to market cattle through OQBN. OQBN premiums are measured as the weighted average premium for OQBN VAC-45 calves relative to non-preconditioned calves at the same sale.  The Fall 2022 overall average premium across locations and weights was $18.67/cwt, the highest since 2014.

 

When we break that premium down across steers and heifers, steers averaged premiums of $18.27/cwt while heifers topped that at $19.12/cwt (Figure 2). Looking across weight classes, lighter weights tend to bring higher per cwt premiums. The bulk of OQBN lots are marketed as 4 weights to 6 weights. Across those weights, the calculated average premium per head for steers ranged from $92.25 to $114.84 and from $84.24 to $115.78 for heifers.

 

The 2022 fall marketing season included 9 fall sales across 6 Oklahoma livestock markets. Total fall enrollment included 2,784 head and 63 producers, with 1,633 head marketed through OQBN VAC-45 certified sales. The numbers are not too surprising, given that drought forced early weaning and marketing for many producers in the state. Overall, the data used to calculate 2022 premiums includes 10,583 head marketed in 1,252 lots. That data includes 232 OQBN lots. As expected, sales where more OQBN calves or other preconditioned calves were present tended to have higher premiums for those calves, as those sales usually attract a larger number of buyers to compete for preconditioned calves. 

 

Markets never make guarantees and preconditioning is not free. That said, past research indicates that 80% of the time, certified preconditioning with OQBN nets positive returns. OQBN has no minimum requirement on number of head enrolled, so the program is accessible to all producers, large and small. More information about the OQBN protocol, past market premiums, upcoming marketing opportunities, program enrollment and Extension educator contact information can be found on the Oklahoma Quality Beef Network program page.