Cattle on Feed Report About as Expected

Posted on Fri, 05/22/2020 - 14:33

USDA’s Cattle on Feed Report showed major declines in both the number of cattle placed into feedlots and those marketed last month due to the Covid-19 situation. But the numbers were basically in line with pre-report estimates.

On May 1, USDA estimates there were 11.2 million head of cattle in large feedlots (1,000-plus head), down 5.1% from last year. That was the fewest number on feed for this date since 2017 and 43,000 head less than the five-year average.

April placements plunged 22.3% from year-ago, while marketings plummeted 24.3%. Placements were the second lowest for April since USDA’s data series began in 1996, and Marketings were the lowest for the month during that span.

Cattle on Feed Report

USDA

(% of year-ago)

Avg. Trade Estimate

(% of year-ago)

On Feed on May 1

94.9

95.1

Placements in April

77.7

77.4

Marketings in April

75.7

75.1

 

Not surprisingly, placements were down sharply in every weight category. April placements plunged 16.9% for lightweights (under 600 lbs.), 28.0% for 6-weights, 29.5% for 7-weights, 20.8% for 8-weights, 14.3% for 9-weights and 17.6% for heavyweights (1,000-plus lbs.) from year-ago levels. Placements in Texas, Nebraska, Kansas and Colorado dropped a combined 345,000 head from year-ago, which was 84.1% of the total U.S. decline.

With the data basically in line with expectations, there should be little if any market impact on Monday. Focus is on the recovering cash market as slaughter capacity rebounds from the Covid-19 slowdowns and closures. But traders will continue to keep futures well below the cash market.