Overall feed and forage will be favorable and provide more flexibility for feeder and feedlot cattle operations. Potentially emerging drought conditions are a threat and may reduce production and marketing flexibility.
The cattle industry sees a glimmer of hope in last week’s harvest data, with estimated slaughter at 452,000 head, down 32.2 percent year-over-year, but up 6.4 percent from the prior week.
It is critical for consumers to know that there is no shortage of meat in the U.S. In fact, production of beef, pork and poultry are projected at record levels in 2020.
Current wholesale beef values are lower year-over-year, but it’s too early to gauge what impact the COVID-19 virus has had on both export and domestic beef demand.
The coronavirus is another “black swan” that is different in some fundamental ways from other such events in cattle markets, such as the packing plant fire last year or even the first BSE case in late 2003.
Cattle on feed data shows the largest number of cattle in feedlots during February since 2008, while placements were 99.4% of year ago, a little smaller than expected.
USDA’s latest carcass weights data show steers 12 pounds heavier than last year and heifers 13 pounds heavier than last year, resuming a higher trend after moderating the past three years.
The latest monthly cattle on feed report showed the January 1 inventory in feedlots (over 1,000 head) at 11.958 million head, 102.3 percent of one year ago. This is the largest January on-feed total since 2008.
Widespread wildfires mean Australian cattle and beef production will be reduced for the foreseeable future and rebuilding, whenever it can begin, will take several years.
