Cattle on Feed Report in line with pre-report expectations

USDA estimated there were 11.930 million head of cattle in large feedlots (1,000-plus head) as of Jan. 1, up 248,000 head (2.1%) from year-ago and virtually matching pre-report expectations. December placements dropped 4.5%, while marketings slipped 0.9% from year-ago levels.

Placements dropped in each of the categories except for 9-weights, which were up 4.8% from year-ago but accounted for only 6.5% of the total number of calves moved into feedlots during December. Placements dropped 2.2% for lightweights (under 600 lbs.), 3.5% for 6-weights, 8.4% for 7-weights, 6.7% for 8-weights and 5.6% for heavyweights (1,000-plus lbs.). Placements declined 10,000 head in Colorado, 40,000 head in Kansas, 35,000 head in Nebraska and 20,000 head in Texas, while “other states” placed 25,000 head more cattle into feedlots than year-ago during December.

Feedlot inventories included 7.195 million head of steers (up 163,000 head; 2.3%) and 4.735 million head of heifers (up 85,000 head; 1.8%).

This report is about as neutral as it gets, with all three categories virtually matching the average pre-report estimates. As a result, the market should have little to no price response.