Peel: Cattle on Feed and Feeder Supplies

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The February Cattle on Feed report from USDA showed a February 1 feedlot inventory of 12.1 million head, 101.5 percent of one year ago. 

January placements were 2.017 million head, up 3.2 percent year over year.  Placements were higher than the average pre-report estimate but at the top end of the range of analyst estimates.  The increase in placements was mostly in cattle weighing 700-900 pounds but did also include a 5.1 percent year over year increase in cattle weighing less than 600 pounds. 

January marketings were 1.822 million head, down 5.6 percent from one year ago and about as expected.  However, January 2021 had two less slaughter days than the year before meaning that daily average marketings this year were 3.8 percent higher than last year.

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. 

In the last half of the year feedlot placements were almost unchanged year over year, up 0.3 percent.  However, this average belies dramatic dynamics as feedlot placements in the third quarter were up 8.5 percent year over year while placements in the fourth quarter were down 7.0 percent from the prior year. 

Total estimated feeder supplies outside of feedlots on January 1 were 25.66 million head, down just 0.2 percent year over year.  The 1.3 percent year over year decrease in the 2020 calf crop, even when adjusted by decreased veal slaughter and increased feeder cattle imports, would have suggested a bigger decrease in the feeder supply on January 1.

It appears that some feeder cattle were carried over into 2021 and likely is reflected in the relatively large January placements.  Feeder supplies are somewhat front-loaded early in 2021 but should tighten up in the second half of the year.

 

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