Senior Farm and Ranch Broadcaster, Ron Hays, is talking with Oklahoma State University Livestock Market Economist, Derrell Peel, about the latest USDA Cattle on Feed Report released on March 22, 2024.
“The March Cattle on Feed Report showed placements in the month of February that were up 9.6 percent over last year,” Peel said. “Marketings in February were up 3 percent over last year. That gives us a March 1 on-feed total that is up 1.3 percent compared to one year ago.”
Peel said the placement number was larger than the pre-report estimates, but it is important to note that January was down significantly, and February was up. When you put the two together, Peel said they average out to about the same number as last year.
“Cattle on Feed Reports don’t make cattle, so if we come in with a bigger placement number, it means that we changed the timing of cattle, but it doesn’t change the overall numbers that much,” Peel said.
Cattle prices have been moving up steadily, but Peel said some of that is because the seasonality of light calves and feeder cattle generally increases through the first quarter of the year.
“This may give us a little pause and might give us a slight correction in the futures market,” Peel said. “I don’t think we will see the kind of correction we had last fall that really kind of overcorrected, in my opinion. I would be surprised if we saw that kind of reaction.”
Peel said the rate of cattle coming to town has been consistent, and producers have also been taking advantage of good wheat pasture and good cattle markets. When it comes to conversations on heifer retention, Peel said there is not much indication that producers have begun the retention process.
“It is not clear yet that we are doing that, so I think we have to wait and see,” Peel said. “Next month’s Cattle on Feed Report for April will give us a quarterly breakdown of steers and heifers in feedlots. That may give us some indication of whether we are beginning to reduce the rate at which we have been placing heifers in the feedlot.”
Peel said this season for wheat pasture has certainly been the best in a few years, so some bigger feeder cattle are expected to come to town later in April and May.
“Producers have taken advantage of this market, but we certainly have continued to see very strong prices that reflect the strong underlying support from these tight supply fundamentals.”
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