TOPEKA, Kan. — The latest U.S. Cattle on Feed report revealed an August 1 inventory of 11.28 million head, which is the largest in almost 25 years. July feedlot marketings were 99.4% of a year ago, but placements were 111% of last year, the largest since July 2011. According to Oklahoma State University Extension Livestock Marketing Specialist Derrell Peel, marketings were about as expected, but placements were well above even the highest pre-report expectations and pushed the on-feed total slightly higher than expected. In Kansas, the inventory was up 3% from last year at 2.41 million head, with placements up 16% at 520,000 head.
Peel said feedlot dynamics are a challenge to figure out after the turbulence of the first half of the year. U.S. placements were down 17.7% year over year in February, March and April and, despite the 11% increase in July, are down 7.1% year over year for the last six months. Marketings dropped dramatically in April and May, down 25.6% year over year in those two months, and are down 6% in the six months from February to July.
One of the biggest concerns, Peel explained, is how much remains of the fed cattle backlog that was created in April and May. He said although June and July marketings were about equal to one year ago, a significant portion of those likely were cattle carried over from April and May. Overall, total placements were down from February to July, with most of the reduction falling in the heavyweight category, further reducing the number of cattle finishing now.
Peel believes data and anecdotal indications show the backlog of fed cattle rapidly diminishing. He said, going forward, the one million head decrease in feedlot placements in February, March and April suggests that front-end feedlot supplies will be relatively tight at least through September.
— Kansas Livestock Association
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