By Kenny Burdine
The November Cattle on Feed report was released on Friday afternoon, November 19th. USDA cattle on feed reports estimate cattle inventory in feedlots with one-time capacity over 1,000 head. Feedlots of this size represent 84% of total cattle on feed numbers based on a comparison of the July Cattle on Feed report and total on-feed numbers from USDA’s mid-year cattle inventory report. The November 1 estimate came in at 11.9 million head, which was basically steady with last year’s November on-feed inventory. Cattle on feed numbers tend to grow from fall to winter, which can be seen in the chart above.
Cattle on feed numbers increase this time of year because large numbers of spring born calves move through markets. October 2021 placements were 2.4% higher than the same month last year. Comparisons to last year remain challenging given what a strange year 2020 was, but this was a little surprising given the smaller 2021 calf crop. Examining on-feed placements by weight category for the month of October provided some perspective on this as it showed that placements were slightly higher in most all weight categories, but the largest increase from last year was in the 800 to 900 lb category. This one category accounted for over 70% of the increase in placements from last year. Given those placement weights, these would be cattle coming out of some type of growing program and continues to speak to the incentive to move heavier feeder cattle given current feed price levels.
Marketings were actually down about 5% from last year, which makes sense given the strength that we have been seeing in fed cattle prices. We had previously discussed that feedlots appeared to be getting more current and days on feed were decreasing, based on Kansas State’s Focus on Feedlots data. Fed cattle prices have moved up sharply over the last few weeks, which is consistent with smaller feedyard offerings and packers being more aggressive. I tend to think we will see more of this going forward as cattle supplies continue to get tighter in the coming months. With April 2022 CME(C) live cattle futures on the board over $140, we appear to be setting up for a very strong spring fed cattle market.
Source : osu.edu