Cattle on Feed Report 01/22 14:05
Jan. 1 Cattle on Feed Up Slightly
By DTN Staff
USDA Actual Average Estimate Range
On Feed Jan. 1 100% 99.3% 98.8-99.9%
Placed in Dec. 101% 97.0% 98.9-106.5%
Marketed in Dec. 101% 100.7% 100.3-101.8%
OMAHA (DTN) -- OMAHA (DTN) -- Cattle and calves on feed for the
slaughter market in the United States for feedlots with capacity
of 1,000 or more head totaled 12.0 million head on Jan. 1, 2021.
The inventory was slightly above Jan. 1, 2020, USDA NASS
reported on Friday.
The inventory included 7.40 million steers and steer calves, up
slightly from the previous year. This group accounted for 62% of
the total inventory. Heifers and heifer calves accounted for
4.57 million head, down slightly from 2020.
Placements in feedlots during December totaled 1.84 million
head, 1% above 2020. Placements were the second highest for
January since the series began in 1996. Net placements were 1.78
million head. During December, placements of cattle and calves
weighing less than 600 pounds were 460,000 head, 600-699 pounds
were 435,000 head, 700-799 pounds were 425,000 head, 800-899
pounds were 317,000 head, 900-999 pounds were 110,000 head, and
1,000 pounds and greater were 95,000 head.
Marketings of fed cattle during December totaled 1.85 million
head, 1% above 2020. Marketings were the second highest for
January since the series began in 1996.
Other disappearance totaled 60,000 head during December, 10%
"Why does it seem like every time the market closes sharply
higher and has the industry on the edge of its seat waiting for
a highly anticipated bullish report to be shared that bearish
news ends up creeping into the marketplace? Surprise, surprise!
Friday's Cattle on Feed report did not unveil what analysts
projected whatsoever and ended up showing higher placement
figures for the month of December 2020," said DTN Livestock
Analyst ShayLe Stewart.
"Cattlemen and feedlots alike were praying that the report would
yield lighter placement numbers and ultimately be added to the
last two reports that also showed lighter placement figures.
But, most importantly, lighter placements mean that, later,
tighter fed cattle supplies will most likely be found, which can
help feedlots regain some market share and greater
"Conversely, higher placements mean greater placements could be
found later down the road, which can pressure the market's
supply and cause prices to fall lower. When looking at the data
shared in Friday's report, it's important to keep a couple of
things in mind.
"First, placements were up a mere 1% -- not 2%, not 5%, but
simply 1%. Following two months of lighter placements, we must
understand that, at some point, cattle were going to start
working their way back into the feedlots and would end up being
accounted for on this report.
"Secondly, putting aside what we all hated about 2020, the fact
remains that, with unmatched consumer demand, beef slaughter
speeds were commendable throughout the year. On a per head
basis, only roughly 3.5% fewer cattle were processed in 2020
than in 2019 even with reduced slaughter speeds throughout the
spring and the lack of the food service industry. So, when
December came around and feedlots were happy to market their
heavier cattle to packers instead of carrying them into the New
Year, that allowed for more bunk space to become available and
ultimately led to higher placements.
"In conclusion, Friday's Cattle on Feed report took the market
by surprise, as higher placements weren't even considered an
option earlier in the week. After the market takes in the
initial shock of 'higher placements,' there is still enough
technical and fundamental support working in the market's favor
that this report shouldn't crumble the market to its core."
DTN subscribers can view the full Cattle on Feed reports in the
Livestock Archives folder under the Markets menu. The report is
also available at https://www.nass.usda.gov/.
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