Cattle Outlook: Japan Top Export Market28 January 2013
US - Prior to 2004, Japan was consistently the largest foreign buyer of U.S. beef. Following the December 2003 announcement on BSE in the U.S. their purchases of U.S. beef dropped to zero for several years.
It has been a long, slow process to recover the Japanese market, but though the first 11 months of 2011 Japan is once again the largest export market for U.S. beef.
It appears that Japan may be about to loosen their restriction on U.S. beef imports. Currently only beef from U.S. cattle slaughtered at 20 months of age or less is eligible for shipment to Japan.
The age restriction is expected to change soon to cattle slaughtered at 30 months of age or less. That should boost our beef shipments to Japan.
On February 1 USDA will release their January U.S. cattle survey results. I expect it to say beef cow numbers are down compared to a year ago but the number of beef replacement heifers is higher than last year.
I expect both the dairy cow inventory and dairy replacement heifer numbers to be below last January's level. We won't get an official estimate of the size of the 2013 U.S. calf crop until July, but I expect it will be smaller than the year before for the 18th consecutive year.
Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $122.53/cwt, down $1.67 from last week and down 47 cents from the same week last year. On a dressed weight basis steers averaged $197.93/cwt this week, up 17 cents from the week before.
Beef carcass cutout values were lower this week. On Friday morning, the choice boxed beef carcass cutout value was $187.60/cwt, down $3.42 from last Friday, but up $3.43 from a year ago.
The select carcass cutout was $182.18/cwt, down 34 cents for the week, but up $2.97 year-over-year. Over the last nine weeks, the choice-select price spread has decline from $21.69/cwt to $5.43/cwt.
This week's cattle slaughter totaled 625,000 head, up 1.6 per cent per cent dressed weight for the week ending on January 12 was 872 pounds, down 4 pounds from the week before, but up 18 pounds from a year ago. This was the 53rd consecutive week with steer weights above the year-earlier level.
Feeder cattle prices at this week's Oklahoma City auction were steady to $5 lower than last week. Their price ranges for medium and large frame #1 steers were: 400-450# $188-$196, 450-500# $180-$190, 500-550# $170-$184, 550-600# $159.50-$170, 600-650# $145.50-$160.75, 650-700# $142-$161, 700-750# $143-$148.50, 750-800# $140-$148, 800-900# $137.50-$144, and 900-1000# $133-$138.50/cwt.
The February live cattle futures contract closed at $126.30/cwt, up $1.35 from the previous Friday. April cattle settled at $130.75/cwt, up 93 cents for the week. June fed cattle contracts ended the week at $126.52/cwt.
TheCattleSite News Desk