Analysts continue to sort through the impacts of the latest USDA Cattle on Feed report, released in August. Texas A&M Extension ag economist David Anderson says placement numbers reversed course, pointing at range conditions.
“Placements were the most interesting number in the report, 8.3% smaller than last July,” he says. “Smaller placements broke the two-month streak of placements exceeding the year before. The larger May and June placements may have pulled some ahead from July. Changing pasture and range conditions may have contributed to larger placements earlier in the summer and fewer placed in July.
Anderson says this year’s placements are a little below last year.
“For the year, placements are now 2.3% below last year,” he says. “That makes some more sense compared to available feeder supplies and last year’s calf crop.”
How many heifers are being held back remains a key question.
“A good, unanswered question is the contribution of heifers to placements,” Anderson says. “Placements down sharply could reflect some more heifers held back with some improving pastures. The October report will provide the next update of the number of heifers on feed.”
Looking at the numbers by weight, the trend of lower placements generally continued.
“Placements were lower for every reported weight category except those over 1,000 pounds which were equal to a year ago,” Anderson says. “Placements of feeders weighing over 900 pounds accounted for 16.1% of total placements, the largest percentage for a July since 2019. Very heavy feeder placements are highly seasonal based on yearling grazing in some parts of the country, typically peaking in August-September at about 18-19% of total placements in those months.”
He expects cattle on feed numbers to continue to decline as producers try to rebuild the national cattle herd, while support remains for high prices.
“The number on feed is likely to continue to decline as fewer calves are available for placement and if more heifers are reserved to enter the herd,” Anderson says.
“All in all, the report indicates continued support for high cattle, calf and beef prices.”