Cattle On Feed Numbers High

US - USDA's July cattle on feed report is bearish. June placements were much higher than expected, writes Ron Plain, University of Missouri.

25 July 2011

3 minute read

North America

Ron Plain

The total number of cattle on feed at the start of July was up 3.8 per cent compared to July 2010. The pre-release survey of forecasts predicted an increase of 2.7 per cent. The number of cattle on feed has been above the year-earlier level for the last 14 months. The July inventory is the highest on-feed number for any July since 2007.

USDA said June placements of cattle into large feed yards (over 1,000 head capacity) were 4.1 per cent higher than in June 2010. The average of pre-release trade forecasts was for June placements to be down 6.6 per cent. Placements have been above year-ago levels for 13 the last 16 months causing many to think we had pulled ahead on placements. Yet, June placements were the highest of any June since 2006. Extremely dry pastures in the southern plains, particularly Texas and Oklahoma, are pushing cattle toward feed lots. In mid July, 94 per cent of the pastures in Texas were rated poor or very poor as were 78 per cent the pastures in Oklahoma. The number of feeder cattle coming north from Mexico was up 25 per cent during the first five months of 2011, which also boosts placement numbers.

USDA said marketings of fed cattle from large feed yards during June totaled 2.102 million head, up 5.3 per cent compared to June 2010. The trade forecast June l marketings to be up 2.8 per cent. Last month's marketings were the highest of any June since 2007.

The number of cattle placed on feed weighing less than 600 pounds was up 4.5 per cent from last June. Placements of feeders weighing 600 to 700 pounds were up 26.7 per cent; placements weighing more than 800 pounds were down 9.4 per cent compared to a year earlier. The calculated average weight of cattle placed on feed during June was 1.3 per cent lower than in June 2010.

The number of steers on feed was up 4.2 per cent and the number of heifers on feed was up 3.4 per cent on July 1. The percent of animals on feed that are heifers (34.8 per cent) is the lowest of any July since 2006. This may indicate an expansion of the cow herd is coming.

The average retail price for choice beef during June, $4.809 per pound, was down 6.3 cents from May, but up 31.8 cents from June 2010. Slaughter steer prices averaged $107.20/cwt in June.

Cattle on Feed, 1000+ Capacity Feedlots, U.S.
	2009	2010	2011	Percent of Year Ago
	---- - 1,000 head -----
On Feed June 1	10,407	10,495	10,928	104.1%
Placed during June	1,391	1,628	1,695	104.1%
Marketed during June	1,989	1,997	2,102	105.3%
Other Disappearance	57	55	70	127.3%
On Feed July 1	9,752	10,071	10,451	103.8%