The feedlot situation in early 2021 is a carryover from the disruptions and unusual dynamics last year. For the entire year in 2020, feedlot placements were down 4.0 percent.
A massive and extended winter blast has engulfed the southern plains before spreading across much of the Delta. The storm impacts cattle producers who are struggling to provide water and feed access for cattle.
The cattle on feed inventory on Jan. 1 (14.71 million head) is a record 57.3% of the feeder cattle supply. This means there are less than two head of feeder cattle available outside feedlots for every animal on feed.
Drought persists across much of the west and has extended into much of the Great Plains, with several states showing the impact of the drought on hay production and supplies and the challenges for cattle producers.
The beef industry reacts to high feed prices differently than other species as the ruminant biology of cattle means less grain will be used by changing how cattle are produced more than by changing production levels.
U.S. beef trade is stabilizing as the ripple effects of the initial COVID-19 disruptions continue to fade. The latest beef trade data for November shows that monthly exports were up 13.2 percent year-over-year.
Numerous factors are in place that will shape cattle markets for at least the first few months of 2021. The COVID pandemic will continue to limit food service and restaurant demand for beef.
