USDA’s next cattle on feed report is to be released on Friday, June 21st. This one is coming out against a backdrop of rising fed cattle prices, higher Choice beef cutout values, and beef production that is slightly larger than last year. It’s going to be an interesting report because it should continue to show declining numbers of cattle in feedlots and indicate falling beef supplies in coming months.
Market analysts who publish pre-report estimates generally expect May feedlot placements to be smaller than those last May. The range of estimates runs from placements down 5 percent to up 1 percent (I’m the analyst who is down 5 percent on placements). USDA reports that the number of feeder cattle going through auctions, video and internet sales, and direct sales were down 4.8 percent compared to those last May. The number of feeder cattle in May reported as part of the CME feeder cattle index was down 19.5 percent compared to a year ago. Contrasting those data points, feeder cattle imports from Mexico were about 30,000 head larger than last year.
Feedlot marketings should be about even with a year ago. Daily steer and heifer slaughter during May was 100.4 percent of last May, with the same number of work days in the month. Continued near record dressed weights of those cattle marketed, largely due to longer feeding periods, is adding to beef production.
Combining placements and marketings should leave the number of cattle in feedlots on June 1 about 1.7 percent smaller than last year. June 1 should mark the second straight month of smaller cattle inventories. The number of cattle on feed for longer than 120 days should continue to decline, as well. Shrinking cattle inventories will begin to cut into beef production in coming months limiting the impact of heavier weights on supplies. On balance, fewer cattle on feed will keep pressure on for higher cattle and calf prices.
Anderson, David. “A Cattle On Feed Preview.” Southern Ag Today 4(25.2). June 18, 2024. Permalink
