Strong Fundamental Outlook for Cattle Market
September 24, 2023
OMAHA (DTN) -- Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.1 million head on Sept. 1, 2023. The inventory was 2% below Sept. 1, 2022, USDA NASS reported on Friday.
Placements in feedlots during August totaled 2.00 million head, 5% below 2022. Net placements were 1.95 million head. During August, placements of cattle and calves weighing less than 600 pounds were 420,000 head, 600-699 pounds were 305,000 head, 700-799 pounds were 455,000 head, 800-899 pounds were 488,000 head, 900-999 pounds were 245,000 head, and 1,000 pounds and greater were 90,000 head.
Marketings of fed cattle during August totaled 1.88 million head, 6% below 2022.
Other disappearance totaled 55,000 head during August, 4% above 2022.
"Friday's Sept. 1 Cattle on Feed report comes with a sigh of relief for cattlemen and traders, as the report came with no surprises and supports the market's strong fundamental outlook," said DTN Livestock Analyst ShayLe Stewart.
"The big question in Friday's report was: Where will the August placement data land, exactly? With analysts having a wide spread in their estimates, (ranging anywhere from 92.0% to 98.1% compared to a year ago) there was a mixed consensus on what placement data would be. But when looking through the report thoroughly, it's evident that there were fewer cattle placed in August, as the market simply has fewer cattle to offer, especially following the big placements seen in June and July. The only states that saw an increase in placements compared to a year ago were Idaho (up 7%), Kansas (up 3%), Texas (up 2%) and Washington (up 13%). And it was also interesting to note that when looking at the placement data from a weight group perspective, not one single division in Friday's report surpassed that of a year ago. That again emphasizes the fact that there are simply fewer cattle in today's market than there were a year ago.
"All in all, Friday's Cattle on Feed report should be viewed as another favorable report to the market, as no surprises were found, and the data came as expected. And when looking to the fall feeder cattle run that's expected to really take off in the next couple of weeks, Friday's data should be viewed as encouraging news to cow-calf producers, as they are again reassured that their calves should be worth considerably more than what they sold for a year ago."