While USDA posted a headline in their June Cattle on Feed report that there is a three percent decline in total on feed numbers in this latest report- the number that jumped off the page to just about everyone was the five percent increase in placements in May 2023 versus a year ago.
According to USDA- Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.6 million head on June 1, 2023. The inventory was 3 percent below June 1, 2022.
Placements in feedlots during May totaled 1.96 million head, 5 percent above 2022. Net placements were
1.88 million head. During May, placements of cattle and calves weighing less than 600 pounds were 380,000 head, 600-699 pounds were 295,000 head, 700-799 pounds were 480,000 head, 800-899 pounds were 505,000 head, 900-999 pounds were 215,000 head, and 1,000 pounds and greater were 80,000 head.
Marketings of fed cattle during May totaled 1.95 million head, 2 percent above 2022.
Click here for the complete report from USDA.
Oklahoma Farm Report’s Ron Hays talked with a pair of market analysts about the report- Lance Zimmerman, Senior Beef and Cattle Market Research Analyst, Rabo AgriFinance says that the placement number is concerning, at least in the short run. “The biggest shocker in the report is the May Placements number being five percent above a year ago,” He points out that is well above the range of pre report guesses offered by analysts. While marketings were about as expected- it meant the on feed number was not as low as the trade was anticipating.
Hays also talked with Rich Nelson of Allendale- “Keep in mind we have had eight months in a row of lower than last year on these placements- and having a one or two month rebound is relatively reasonable.”
DTN Analyst ShayLe Stewart adds ” sale barn receipts for May were up 29%, so higher placements shouldn’t come as a shock to anyone. Secondly, sale barn receipts have been drastically lighter in June than they were in May, as some producers elected to market their calves early to capitalize on the market’s strength when it was available to them. That could mean that by next month at this time, we will be looking at a new Cattle on Feed report showing lighter placements. The point is this: The market is going to ebb and flow, and placements are going to ebb and flow with the various changes in the cattle cycle and as producers make marketing decisions based on what prices are available to them.”
While the Placements were up compared to last May- the on feed number is under that of a year ago- and in fact- total on-feed numbers as of June first totaled 11.552 million head, which is the lowest in six years. Many analysts believe that the strongest cash cattle prices of 2023 are still ahead of us in the third and fourth quarters.
