Senior Farm and Ranch Broadcaster Ron Hays talked to OSU Extension Livestock Market Economist Dr. Derrell Peel after the latest USDA Cattle of Feed Report was released on Friday afternoon, and despite reduced cattle numbers, cattle on feed are consistent with 2023 numbers.
Dr. Peel said that the report showed September placements at 98% of a year ago, marketings were 102% of a year ago, and the on-feed number as of October 1 is even with a year ago at 100% of last year.
“This report was pretty well anticipated,” Dr. Peel said. “Placements were on the upper end of our range of pre-report estimates, but I don’t think this will cause any particular reaction.”
According to Dr. Peel, the average monthly on-feed total for the past year has been 100% of the previous year. “That’s pretty amazing, given that we know there are less cattle in the country and feedlots have been able to hold these inventories,” he commented.
Feedlots have maintained their inventories is by slowing down their turnover rate, meaning that they are feeding cattle longer and growing them larger, and also by continuing to feed heifers.
“If you look at average placements and average marketings, they’ve both fallen more consistent with what we know is the underlying feeder cattle supply,” Dr. Peel explained. “So, there are fewer cattle in total coming through the system, but a feedlot is like a water tank. There is a pipe going in, that’s placements. There is a pipe going out, that’s marketings, and even if there are fewer placements coming in, you can still maintain the level of the tank if you are restricting the outflow a little.”
This time of year, Dr. Peel said that drought conditions are also keeping the numbers up as producers are having to sell cattle at an accelerated rate as they run out of water and forage.
Although feedlots have maintained their number for several months longer than he expected, Dr. Peel knows that they won’t be able to keep these levels indefinitely. “In the short run, there will be a backside to this where there are fewer cattle,” Dr. Peel observed.
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