USDA Report Hints at Continued Strong Cattle Placements

September 16, 2011 08:43 AM

USDA's Cattle on Feed Reports so far in 2011 have showed Placements into feedlots above year-ago in all but two months (March and June reports). Given a reduced calf crop as projected by USDA, calf supplies have tightened considerable and sooner-rather-than-later, we suspect Placements to begin declining.

But the latest Livestock, Dairy and Poultry Outlook from USDA's Economic Research Service (ERS) doesn't provide any clue the strong Placements trend will end soon. In fact the report states, "Due to the drought-induced placements of feeder cattle, feedlots in the Southern Plains are increasingly full of cattle. The numbers of cattle placed at lighter weights in Southern Plains feedlots will result in generally longer feeding periods and lower slaughter weights when they go to market."

However, ERS says the stronger pace of lighterweight Placements will keep dressed weights from rising significantly. "Although dressed weights are increasing seasonally, they are not increasing as fast as in other years because of the large placements of lightweight calves, and atypical patterns in placement weights and fed cattle weights are occurring," says ERS. "These lightweight placements will likely lead to slightly reduced beef production on a per head basis, but they could result in total steer and heifer beef production for the remainder of 2011 and perhaps into the second quarter of 2012, that is close to year-earlier production."



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