Derrell Peel: COVID-19 Provokes Turbulence In Feedlots

Friday's COF reports shows the impact of COVID-19
Friday's COF reports shows the impact of COVID-19

The latest USDA Cattle on Feed report shows the dramatic impacts of COVID-19 on fed cattle markets.  The May 1 feedlot inventory was11.2 million head, down 5.1 percent year over year.  April marketings were down 24.3 percent from last year, a decrease of 433,000 head year over year.  Decreased marketings reflect the severe disruptions in cattle slaughter in April and continuing into May.  This follows a 13.1 percent year over year increase in March feedlot marketings.  

The average year over year change over March and April together was a 6.4 decrease in marketings.  The slowdown in April marketings and resulting backlog of fed cattle in feedlots would have been more severe without the strong March marketings that pulled some cattle ahead.  The backlog of fed cattle continued to build in May.

April placements were down a sharp 22 percent year over year and follow a 23 percent placements drop in March.  Combined March and April placements were down 867,000 head from last year.  This suggests that a significant drop in expected feedlot marketings starting mostly in September and into October. Of course, the delayed placements from March and April will show up starting in May and will be heavier but the delay will help feedlots have a chance to get current.

The feedlot industry will spend much of the summer working through the backlog of fed cattle but the hole from March and April feedlot placements should provide a marketing window to catch up by this fall if not before.

Packing plant disruptions due to COVID-19 began in early April with a 19.3 percent year over year decrease in steer and heifer the week ending April 11.  Year over year slaughter totals decreased for four weeks culminating in a 41.2 percent year over year decrease in steer and heifer slaughter the week ending May 2.  

The beef packing industry appears to have made significant progress in restoring capacity the past three weeks with estimated total cattle slaughter this past week down 14.2 percent from year ago levels. 


Latest News

Research Highlights: The State of the Current Beef Consumer

This white paper, put together by the National Cattlemen's Beef Association, offers a snapshot of how domestic consumers have responded to the unprecedented events of 2020 as well as a long-term outlook. 

2 hours ago
Ben Tyner
Missing B.C. Rancher’s Family Offers Reward

Wyoming native Ben Tyner disappeared two years ago from the British Columbia ranch he was managing. His family released a video asking the public for information.

2 hours ago
Newborn calf
Selk: Calving Assistance During And After Stage II

Despite our best efforts at bull selection and heifer development, cows or heifers occasionally need assistance at calving time. Here are recommendations on when to provide calving assistance for cows and heifers.

7 hours ago
Winter bale grazing
North Dakota To Consider Voluntary Checkoff

A North Dakota state representative has introduced legislation that would make the state's additional $1 beef checkoff voluntary. It would have no impact on the national Beef Checkoff.

1 day ago
Greg Hanes: What Have You Done for Me Lately?

In this commentary Greg Hanes, CEO of the Cattlemen's Beef Board, discusses the ways that Beef Checkoff dollars have been used in the past few months.

1 day ago
Cattle and hog feeding
Profit Tracker: Steady In The Red

Cattle and hog feeding margins were little changed last week, with both recording modest losses. Beef packers saw improved margins on significant gains in wholesale beef prices.

1 day ago