The United States Department of Agriculture released their monthly Cattle on Feed report this afternoon (Jun 22). The report showed that 11.082 million head of cattle were in feedlots with 1,000 head or more capacity on June 1, 2012, up 1.7% from a year ago. The on feed number was one percentage point above the average pre-report expectation and on the high end of the range of expectations. Placements of feeder cattle into feedlots was 15.3% above year ago levels in May, above the average expectations but within the range of these expectations. This stark increase is largely attributable to the deteriorating pasture conditions across key cattle states and falling corn prices in May. Last year’s drought primarily affected the southwestern states and was more localized, whereas the drying landscape is more widespread this year. Marketings during May were less than anticipated. The report will likely be viewed as bearish when markets re-open on Monday.
Cattle on Feed Report Summary:
|(1,000 head)||% of 2011||Average||Range|
|Placed during May||2,087||115.3%||114.2%||99.4%||–||118.6%|
|Marketed during May||2,015||100.6%||105.0%||102.7%||–||106.6%|
|On Feed, Jun 1||11,082||101.7%||100.7%||98.8%||–||101.9%|
Placements by state and weight group show that placements were up sharply across the board, with Texas being the lone exception. Keep in mind it was this time last year that cattle started flooding into feedlots across the Lone Star state due to the severe drought conditions. The ground is getting pretty thirsty in that region again, but it is not as drastic as it was and last year’s culling will limit the number of cattle available now.
|Weight Group||Kansas||Nebraska||Texas||US Total|