CattleFax analysts told those in Phoenix, Arizona, for the Cattle Industry Convention that increasing beef and total meat supplies will weigh on beef prices during 2018. Senior analyst Kevin Good said consumer demand, both domestically and internationally, will remain good, but the larger amounts of total protein will push prices for beef and cattle slightly lower compared to last year.
Domestically, Good said retail demand is increasing and could show additional strength as beef prices moderate. He said CattleFax is forecasting U.S. beef exports to increase over last year, but the rate of expanded production will outpace additional international sales.
Good said leverage will continue to be a challenge for the feedlot and packing segments, with shackle space constrained by rising cattle harvest numbers. With the growth in production, he anticipates lower, but still profitable price levels for the cow-calf segment, while feeders and backgrounders will experience narrower margins.
CattleFax is projecting fed cattle prices to average $115 per hundredweight, with resistance at $130 per hundredweight and downside risk in the upper $90s per hundredweight. Analysts predict 750 lb. steers will average $1.00 lower than 2017 at $145, with a range from the upper $120s per hundredweight to $160 per hundredweight. Calves are expected to average $158 per hundredweight for 2018 and range from $170 per hundredweight for the spring high to the upper $130s per hundredweight for the fall low.
