February Cattle on Feed

By : Josh Maples, Assistant Professor & Extension Economist, Department of Agricultural Economics, Mississippi State University

The February USDA NASS Cattle on Feed Report was released last Friday and showed feedlot inventory at 11.93 million head on February 1 for feedlots with capacity of 1,000 head or more. This was up 2.2 percent over the same date in 2019. The report was generally neutral as it was within the range of expectations pre-report, but the number of placements during January were lower than the majority of pre-report estimates which could be viewed as slightly bullish. However, the Friday report was nowhere near bullish enough to exclude cattle from the rough day that financial and commodity markets are having on Monday.

The 11.93 million head is the largest February total in the past 12 years and is the fourth largest February total since the series began in 1996. While the U.S. total was up 2.2%, there were some differences among states. Feedlots in Texas showed the largest increase in inventory since a year ago with 190,000 more head (6.9%) on February 1, 2020 as compared to February 1, 2019. The next two largest increases were Kansas which is up 150,000 head (6.7%) and Colorado which is up 60,000 head (5.8%). The largest state decrease was Nebraska which was 100,000 head lower (3.9%) than a year ago.

Placements of cattle into feedlots in January were down 0.6% as compared to January 2019. Most pre-report estimates were for a slight increase in placements. Despite having the largest inventory gains among states since a year ago, Texas had the largest decrease in placements at 50,000 fewer than in January 2019. Kansas showed the largest increase at 60,000 head more than a year ago.

Marketings in January were up 1.1% over a year ago and this was very near the average of pre-report expectations. Overall, the report was fairly well-anticipated with no major surprises.

The Markets
Both Live and Feeder Cattle futures markets are sharply lower on Monday along with the majority of stocks and commodities. At the time of this writing, many Feeder Cattle contracts were limit-down, and the Live cattle contracts were down $2.50 – $3.00 per cwt. This will likely lead to expanded limit days for at least some live and feeder futures contracts tomorrow. The Dow Jones Industrial Average (DJIA) was down over 1,000 points or about 3.6% with many analysts pointing to new cases of Coronavirus over the weekend as a primary reason. 
 
 
Week of
Week of
Week of
Data Source: USDA-AMS Market News
 
2/21/20
2/14/20
2/22/19
5-Area Fed Steer
all grades, live weight, $/cwt
$119.71 
$118.90 
$126.36 
all grades, dressed weight, $/cwt
$190.07 
$190.27 
$201.97 
Boxed Beef
Choice Price, 600-900 lb., $/cwt
$205.71 
$207.52 
$217.72 
Choice-Select Spread, $/cwt
$2.72 
$2.91 
$5.36 
700-800 lb. Feeder Steer 
Montana 3-market, $/cwt
$148.21 
$143.20 
Nebraska 7-market, $/cwt
$150.82 
$146.04 
$148.10 
Oklahoma 8-market, $/cwt
$140.93 
$137.63 
$140.41 
500-600 lb. Feeder Steer 
Montana 3-market, $/cwt
$177.02 
$176.13 
Nebraska 7-market, $/cwt
$182.24 
$175.93 
$184.69 
Oklahoma 8-market, $/cwt
$177.32 
$171.44 
$173.98 
Feed Grains
Corn, Omaha, NE, $/bu (Thursday)
$3.78 
$3.81 
$3.70 
DDGS, Nebraska, $/ton
$145.06 
$146.50 
$140.00 
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