Cattle on Feed

Pre-Report Estimates for Friday’s Cattle on Feed Report

Wed August 17, 2022

Pre-report estimates were released this week for the upcoming Cattle on Feed report that USDA NASS will release on Friday August 19, 2022. Collectively, analysts look for placements and marketing numbers below a year ago. There was one less slaughter day relative to last year which influenced overall totals.

The marketing estimates averaged 96.6% of a year ago, implying a daily marketing rate slowed relative to last year. Year to date cattle marketed from feedlots since January is even with last year.

Placement estimates look to still be heavily drought influenced. Analysts predicted placements would be both higher and lower than last year with a range of 96% to 101.3% of a year ago. The pre-report average was 98.9%. Weekly feeder cattle and stocker receipts released by USDA AMS indicated smaller total volumes versus 2021. Interestingly and somewhat conflicting with the drought theme is the percent in the weekly receipts that are over 600 pounds. Typically, when placements are placed in summer months due to drought cattle enter feedlots at light weights. Auction data reported 63% of total receipts were over 600 pounds compared to 58% last year. Direct sales reported 91% over 600 pounds versus 92% in 2021. Video/Internet auctions reported 79% were over 600 pounds in July of 2022 versus 71%.

This report also provides the percent of heifers moving through marketing channels. Auctions, direct sales and video auctions all showed the percent of heifers was smaller than last year, but is still close to 40% of feeder cattle receipts. Auction reported 40%, direct sales 38%, and video auctions reported 34% in July. In July 2021 direct sales and auctions reported larger than 40% of volume were heifers.

The July 1 inventory indicated heifers retained for breeding was very low, but for many of these marketing channels this is the lowest percentage of heifers in months.

The average August 1, cattle on feed estimate averaged 100.8, with a range of expectations of 100% to 101.1% of a year ago on feed.

Cattle prices have remained firm even as cattle on feed numbers have maintained high values. Late summer strength in fed prices has been something to watch. This week the negotiated 5-area has been over $146 versus a $141 per cwt on the August futures contract and $145 for October and a December price over $151 per cwt. Between North and South the spread between fed cattle prices remains wide by historical standards. Southern Plains fed cattle prices, which have mostly been below $140 per cwt this year. It does not appear to be a total supply difference. Northern states listed in Cattle on Feed were 3% higher and Southern Plains states are just under a year ago on the July 1 number released last month.