Imports of Feeder Cattle: Mexican Up, Canadian Down

Mexican imported cattle ( WB )

Imports of feeder cattle from Mexico were 3% higher than last year through the first half of 2020. Significantly higher volumes of Mexican imported feeder cattle were noted the last two weeks of May and throughout June which offset the lower volumes recorded through the first 4.5 months of the year.

In a stark contrast to the number of Mexican imports, feeder cattle imports from Canada are 50% lower than the first six months of 2019.

“COVID-19 has undoubtedly played a role in trade flows, impacting supply, demand, currency rates, and behavior,” according to analysts at the Livestock Marketing Information Center (LMIC), Denver. Drought too has played a role, and in May the North American Drought Monitor showed dry conditions in 32% of Mexico. Northern Mexico states of Durango, Chihuahua, and Coahuila all showed significant drought coverage although the worst of the country’s drought is in the southern border areas.”

Imported cattle can go direct to feedlots, or they may go to pasture. Analysts note that imported feeder cattle do not necessarily remain in the states they are imported into.

LMIC tracks cattle from Mexico through ports of entry in Arizona, New Mexico, and Texas.

“U.S. drought conditions imply significant drought in all three states,” LMIC says. “Still, year-to-date Arizona feeder cattle imports from Mexico are up 15%, New Mexico’s are up 4% and Texas is down 10%.”

The weekly data on imported feeder cattle implies that feeder steer imports are outpacing imports of heifers. Year-to-date feeder heifers from Mexico are about even with a year ago while feeder steer volumes are up 3.9%.

LMIC noted that while cattle on feed placements were down overall in May by 1.3%, state breakdowns indicated California, Colordao, Iowa and Kansas all placed cattle at higher rates than a year ago.

“It’s impossible to tease out additions directly influenced by Mexican feeder cattle imports,” LMIC said. “State-level cattle on feed data indicates states placing more cattle last month may have had less of a backlog of cattle on feed greater than 120 days.”

As of June 1, Arizona and Iowa cattle on feed more than 120 days were down from the prior year by 13% and 20% respectively, according to LMIC analysis. California had 6% more cattle on feed 120 days plus, and Colorado had 11% more than June of last year. Kansas was the only state to place more animals in May and have significantly higher volumes of cattle over 120 days, 38% higher than last year on June 1.

Most of the higher volumes of feeder cattle imported from Mexico were in the month of June. Feedlot placement data for June will not be available until the middle of July, but there are still a lot of cattle on feed at 120 days or longer.

Other states, whose placement rates were lower, had large changes compared to a year ago in cattle on feed 120 days and longer. Idaho, and Minnesota have 10-15% more cattle on feed 120 days and longer. Nebraska, Texas and Oklahoma have 25% or more. Oklahoma has the largest volume compared to a year ago with 66% more than on June 1, 2019.

“The July Cattle Inventory (scheduled for release by USDA NASS on July 24, 2020) should see additional steers and heifers backlogged show up in the ‘Other Heifers’ and ‘Steers Over 500 lbs,’ which has the potential to skew the total number of cattle and calves above a year ago,” LMIC said.

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