U.S. Cattle on Feed Update – Oct ’20
Executive Summary
U.S. cattle on feed figures provided by the USDA were recently updated with values spanning through the end of Sep ’20. Highlights from the updated report include:
The Oct ’20 cattle on feed inventory included 7.31 million steers and steer calves, up 6.5% from 2019 levels, and 4.41 million heifers and heifer calves, down 0.3% from the previous year.
Placements in feedlots finished higher on a YOY basis for the fourth consecutive month during Sep ‘20, increasing by 5.9% and reaching a nine year seasonal high level. The YOY increase in placements finished significantly above average analyst expectations of a 2.5% increase. YOY increases in placements were led by those weighing 700-799 pounds (+8.7%), followed by placements weighing 800 pounds or more (+7.5%), 600 pounds or less (+3.5%) and 600-699 pounds (+1.4%).
Total placements in feedlots declined 1.6% on a YOY basis throughout the ’18-’19 production season, however annual placement rates remained 2.8% above three year average figures. ’19-’20 annual placements declined by an additional 0.9% on a YOY basis, despite the recent increases.
Cattle placements weighing under 700 pounds increased 2.5% on a YOY basis during Sep ’20, finishing higher for the fifth consecutive month and reaching a six year seasonal high level. Cattle placements weighing under 700 pounds finished 3.9% lower on a YOY basis throughout the ’18-’19 production season however ’19-’20 annual placements rebounded by 0.2%.
Cattle placements weighing 700 pounds or more increased 7.9% on a YOY basis during Sep ’20, finishing higher for the third consecutive month and reaching a ten year seasonal high level. Cattle placements weighing 700 pounds or more declined on a YOY basis over six consecutive months through June prior to finishing higher over the three most recent months of data. Cattle placements weighing 700 pounds or more declined 0.3% on a YOY basis throughout the ’18-’19 production season while ’19-’20 annual placements declined by an additional 1.6%, despite the most recent increases.
Marketings of fed cattle increased 6.2% on a YOY basis throughout Sep ’20, finishing higher for the first time in the past three months and reaching a 17 year seasonal high level. The YOY increase in marketings was largely consistent with average analyst expectations of a 5.8% increase. Marketings of fed cattle had reached record low levels over the months of April and May as slaughterhouses slowed or closed operations due to outbreaks of COVID-19, prior to rebounding throughout the past several months of data. ’18-’19 annual marketings of fed cattle increased 1.3% YOY, reaching an 11 year high, however ’19-’20 annual marketings declined by 2.9% on a YOY basis, despite the most recent increase.
- U.S. cattle and calves on feed for the slaughter market as of Oct 1st finished 3.8% higher on a YOY basis, reaching a record high seasonal level and finishing slightly above analyst expectations. The YOY increase in the cattle on feed supply was the largest experienced throughout the past two years on a percentage basis.
- Placements in feedlots increased 5.9% on a YOY basis throughout Sep ’20, reaching a nine year seasonal high level and finishing significantly above analyst expectations.
- Marketings of fed cattle increased 6.2% on a YOY basis throughout Sep ’20, reaching a 17 year seasonal high level. The YOY increase in marketings was largely consistent with analyst expectations.
The Oct ’20 cattle on feed inventory included 7.31 million steers and steer calves, up 6.5% from 2019 levels, and 4.41 million heifers and heifer calves, down 0.3% from the previous year.
Placements in feedlots finished higher on a YOY basis for the fourth consecutive month during Sep ‘20, increasing by 5.9% and reaching a nine year seasonal high level. The YOY increase in placements finished significantly above average analyst expectations of a 2.5% increase. YOY increases in placements were led by those weighing 700-799 pounds (+8.7%), followed by placements weighing 800 pounds or more (+7.5%), 600 pounds or less (+3.5%) and 600-699 pounds (+1.4%).
Total placements in feedlots declined 1.6% on a YOY basis throughout the ’18-’19 production season, however annual placement rates remained 2.8% above three year average figures. ’19-’20 annual placements declined by an additional 0.9% on a YOY basis, despite the recent increases.
Cattle placements weighing under 700 pounds increased 2.5% on a YOY basis during Sep ’20, finishing higher for the fifth consecutive month and reaching a six year seasonal high level. Cattle placements weighing under 700 pounds finished 3.9% lower on a YOY basis throughout the ’18-’19 production season however ’19-’20 annual placements rebounded by 0.2%.
Cattle placements weighing 700 pounds or more increased 7.9% on a YOY basis during Sep ’20, finishing higher for the third consecutive month and reaching a ten year seasonal high level. Cattle placements weighing 700 pounds or more declined on a YOY basis over six consecutive months through June prior to finishing higher over the three most recent months of data. Cattle placements weighing 700 pounds or more declined 0.3% on a YOY basis throughout the ’18-’19 production season while ’19-’20 annual placements declined by an additional 1.6%, despite the most recent increases.
Marketings of fed cattle increased 6.2% on a YOY basis throughout Sep ’20, finishing higher for the first time in the past three months and reaching a 17 year seasonal high level. The YOY increase in marketings was largely consistent with average analyst expectations of a 5.8% increase. Marketings of fed cattle had reached record low levels over the months of April and May as slaughterhouses slowed or closed operations due to outbreaks of COVID-19, prior to rebounding throughout the past several months of data. ’18-’19 annual marketings of fed cattle increased 1.3% YOY, reaching an 11 year high, however ’19-’20 annual marketings declined by 2.9% on a YOY basis, despite the most recent increase.