02/27/06 Record numbers of cattle on feed

American Rancher February 27, 2006 The USDA reported Friday that there were a record 12.1 million head of cattle in the nation's feedlots at the start of February. That inventory was up seven percent from a year ago. Marketings of cattle last month were up two percent over a year ago but a lot more animals were moving in. Placements in January jumped 16 percent above the level of January 2005. USDA analyst Shayle Shagum explains why. Shagum: "Exceptionally dry conditions in parts of the country and what that does is force cattle off of pasture and off of range into the feedlots." So how are the various segments of the cattle industry doing? Shagum: "The cow-calf operators are still getting a reasonably good price for their cattle. You are finding that feedlots are getting squeezed a little bit because they paid a lot for cattle in the past and they are watching their prices kind of coming down over time now. And right now we are hearing of rather poor margins for the meat packers who are being forced to pay prices, given tight supplies, are paying prices in the 90s and not seeing commensurate increases in the price of wholesale beef." Shagum sees fed choice steer prices gradually declining from their current level to the low 80 dollar a hundredweight range in the second half of the year. While nationally the feedlot inventory was up seven percent from a year ago, in Idaho the numbers were down two percent and in Washington down 19 percent from last February. I'm Bob Hoff.