Market News & Headlines >> Low Feedlot Placements Boost Cattle Futures
Last Friday’s monthly Cattle-on-Feed report showed lower-than-expected June feedlot placements and confirmed strong June feedlot marketings, easing concerns about cattle supplies in coming months and sending most live cattle and feeder cattle contracts limit-up on Monday.
USDA pegged June feedlot placements at 103.0% of a year earlier compared with pre-report estimates that averaged 106.4% in a range from 103.8%-109.9%. Placements at 1.525 million head were still up 44,000 head from a year earlier and were the largest for June in three years.
Friday’s report put June feedlot marketings at 109.4% of a year earlier, closely in line with trade estimates that averaged 109.5% in a range from 107.0-111.0%. The June marketings of 1.912 million head were up 165,000 from a year earlier and were the strongest for the month in four years.
As a result, the July 1 feedlot inventory was toward the low end of expectations at 101.2% of a year earlier versus trade estimates averaging 101.6% in a range from 100.9%-102.2%. The feedlot inventory, at 10.356 million head was still up 220,000 head from a year earlier and was still the largest for the date in four years.
The breakdown of placements by weight showed cattle continued to go on feed at heavier weights during June. June placements of cattle weighing 800 pounds or more were 117% of a year earlier. In contrast, June placements of cattle weighing less than 600 pounds were only 83% of a year earlier. Meanwhile, the strong June marketings helped keep the July 1 supply of market-ready cattle (cattle on feed for more than 120 days) 7.4% below a year earlier.