The May Cattle on Feed report came in slightly more bearish than many in the trade expected, driven by higher placements and softer marketings, but Derrell Peel, Oklahoma State Universty Extension livestock marketing specialist, cautions the numbers are more about timing than true supply growth.
USDA released its May 1 Cattle on Feed report on Friday, revealing an uptick in feedlot inventories. The number of cattle on feed as of May 1 rose 2% from a year ago, while placements increased by 6%. The data marks a shift in recent market directions, marking the first year-over-year inventory increase the industry has seen in 18 months.
Peel discussed the results with Michelle Rook on AgriTalk on Friday afternoon. He notes the market was braced for bigger placements, but the report still leans negative. He explains the numbers do not suggest any significant change in feedlot supply fundamentals but some changes in timing with feedlots slightly more front-loaded in the next few months.
“The placements were a little higher than expectations. Actually, the marketings were a tiny bit lower than average expectations as well. Taken together, this will probably be treated as an at least somewhat bearish report,” he says.
Even so, Peel stresses the shift doesn’t signal a fundamentally larger cattle herd. Instead, drought and strong prices pulled cattle forward. He adds that front-end loading includes more heifers going to town rather than being retained.
“We’re probably still marketing some heifers that we might have been thinking about trying to hold back,” he says.
Regionally, Texas stands out as an indicator of adjustment after disruptions to Mexican feeder imports.
“Their on-feed inventory now is back to year‑ago levels, which is the first time since the border closed,” he says. “It does suggest that the industry is slowly adjusting to the reality we have right now, without those Mexican cattle.”
Peel also separates last week’s futures “meltdown” from the underlying cash picture.
“This is mostly a futures market thing,” he summarizes. “We haven’t changed the cash market fundamentals at all, and we certainly don’t have more cattle. It’s a short‑term thing. It’s a correction. We’ll bounce back.”
For producers, the May report nudges sentiment more bearish in the near term, but doesn’t undo the tight-supply story underpinning the broader cattle cycle.
Key Report Highlights
- Total Inventory: 11.6 million head on feed across 1,000-plus capacity feedlots, 2% above May 2025.
- Placements: 1.7 million head placed during April (6% above 2025). During April, placements of cattle and calves weighing less than 600 lb. were 330,000 head, 600-699 lb. were 245,000 head, 700-799 lb. were 390,000 head, 800-899 lb. were 457,000 head, 900-999 lb. were 210,000 head and 1,000 lb. and heavier were 70,000 head.
- Marketings: April marketings were slightly slower at 1.64 million, 10% below 2025.
