USDA estimates there were 11.550 million head of cattle in big feedlots (1,000-plus head) as of Oct. 1, down 1.4% from last year and 97,000 head fewer than the average trade estimate implied. The decline in feedlot numbers was driven by smaller-than-expected placements during September, which fell 2.9%, whereas traders anticipated a 1.4% increase. Placements were just under the low end of the range of pre-report estimates. September marketings dropped 3.1% from year-ago, which was more than the 2.5% traders anticipated.
Cattle on Feed Report | USDA | Avg. Trade Estimate (% of year-ago) |
On Feed Oct. 1 | 98.6 | 99.4 |
Placements in Sept. | 97.1 | 101.4 |
Marketings in Sept. | 96.9 | 97.5 |
Feedlots placed fewer animals in all of the weight classes except 6-weights, which were unchanged from year-ago. Placements dropped 2.2% for lightweights (under 600 lbs.), 1.0% for 7-weights, 3.7% for 8-weights, 8.3% for 9-weights and 4.8% for heavyweights (1,000-plus lbs.). The trend of placing fewer lightweight calves wasn’t surprising, but traders expected more middle and heavyweight cattle to move into feedlots last month.
The breakdown of feedlot supplies showed steers down 247,000 (3.4%) head from last year at 7.065 million head and heifers up 80,000 head (1.8%) at 4.485 million head as of Oct. 1.
The placements number is friendly, which should support deferred live cattle futures. Support in nearby futures will be dependent more on the boxed beef and cash cattle markets.