02/27/07 Feedlot inventory and placements down

American Rancher February 27, 2007 USDA issued its latest Cattle on Feed report late last week. Shagum: "The interesting point was that we did see a decline of about 23% in the number of cattle placed during January." That's USDA livestock analyst Shayle Shagum who says that's a major decline. Why the 23 percent drop? Shagum says producers may be holding back on sending animals to feedlots on indications that maybe pastures could get better with recent moisture. Shagum: "But to the extent this may have been caused by weather, you simply couldn't get the cattle off of pasture and into feedlots during January. Some of those cattle may be coming in in February. There are some reports that placements so far in February are heavy." Meanwhile January marketings out of feedlots were up two percent from the year before leaving feedlot inventories down three percent. Shagum says all of this may have little effect on steer prices though, which should average in the 85-dollar a hundredweight range this year. It was $85.41 last season. A difference this year though is higher feed costs which Shagum says is impacting everyone in the cattle industry down to the cow-calf operator. Shagum: "One way that cattle feeders are offsetting their higher grains prices is they are bidding lower for feeder calves." Shagum says as long as feed prices stay high the squeeze will be on but good pasture conditions this spring and summer would provide a little relief. I'm Bob Hoff.