More Cattle on Feed Than a Year Ago

According to last week’s monthly USDA Cattle on Feed Report feedlot inventories are higher than last year at this time, despite very low placements during November.

USDA Livestock Anyalyst Shayle Shagam says that the feedlot inventories were 1 percent higher than a year ago because marketings last month out of feedlots were the lowest on record— down 11 percent from a year ago.

Shagam: “The cost of gain was relatively cheap because corn is low relative to previous years so they could afford to keep cattle on feed longer.”

Which gave feeders more poundage to sell and time to see higher prices, though recently we’ve seen lower prices — which has put the squeeze on feedlots. Shagam says

Shagam: “They paid a lot for those feeder calves six months earlier so feeders are going to see their margins come under pressure.”

He continues with more from the Cattle on Feed Report

Shagam: “During November, producers placed just under 1.8 million head on feed which was about 4 percent below a year ago. During November feedlots marketed just under 1.5 million head which was about 11 percent below a year ago. Which left us with a number of cattle on feed in U.S. feedlots with capacity of 1,000 head or greater on December 1st at just under 10.9 million head which is 1 percent above a year ago.”