Taken together, the USDA’s July Cattle on Feed and Cattle (Inventory) reports do not indicate significant heifer retention, said Derrell Peel, Oklahoma State University Extension livestock marketing specialist, in a newsletter.
Peel said he felt some movement toward herd rebuilding may be starting, but it’s very slow and cautious. It is possible, perhaps even likely, that the January 2025 beef cow herd will be the cyclical low, but the January 2026 inventory likely will be close to unchanged showing very little, if any, growth
USDA REPORTS SHOW CONTINUED DECLINE
The July Cattle on Feed report showed the continued decline in feedlot inventories with June placements down 7.9% year over year, which was more than expected, he said. He went on to say June feedlot marketings were down 4.4% year over year, in line with expectations.
Over the past six months, total placements were 5.0% fewer than a year earlier while total marketings were down 4.0%, Peel said. Placements decreased by 539,000 head, and marketings decreased by 437,000 head in the past six months.
The difference means placements decreased by 102,000 head more than marketings thereby reducing feedlot inventories, he said. Average placements and marketings have been falling for roughly five years, at a faster rate recently.
Decreased flow of cattle through feedlots corresponds to the decline in total calf crop since the cyclical peak in 2018, Peel said.
ON-FEED SUPPLY DOWN
The July 1 feedlot inventory was 11.124 million head, down 1.6% year over year, the eighth straight month of year-over-year decreases in feedlot numbers, he said. The 12-month moving average of feedlot inventories has now dropped to the lowest level since May 2019.
However, the current level is just 2.9% less than the peak in September 2022, indicating feedlot inventories have declined slowly compared to the calf crop, Peel said. The estimated 2025 calf crop was 33.1 million head, 8.8% less than the cyclical peak in 2018.
The estimated supply of feeder cattle outside of feedlots in the July Cattle report was the smallest in 29 years of available data, he said.
ON-FEED HEIFERS DOWN
The July on-feed report showed heifers in feedlots decreased 5.4% from last year, Peel said. However, heifers, as a percentage of total feedlot inventories, was 38.15, up from the April 1 level of 37.6%.
The number of heifers in feedlots would indicate heifer retention is not underway to a significant level, he said.
The July Cattle report showed total cattle inventories at 94.2 million head, down 1.3% from 2023, Peel said. Most report categories were down in the two-year comparison as the industry was clearly liquidating through 2024.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $237.86 per cwt to $238.91, compared with last week’s range of $233.00 to $241.92 per cwt. FOB dressed steers and heifers went for $371.39 per cwt to $383.28, compared with $365.34 to $382.74.
The USDA choice cutout Tuesday was up $4.15 per cwt at $369.94 while select was up $4.35 at $345.94. The choice/select spread widened to $24.00 from $22.73 with 78 loads of fabricated product and 28 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef was $418.49 per cwt, and 50% beef was $179.18.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.45 to $1.60 a bushel over the Sep corn contract, which settled at $3.81 1/2, down $0.05 1/2.
No live cattle delivery intentions were posted.
The CME Feeder Cattle Index for the seven days ended Monday was $336.03 per cwt, down $0.21. This compares with Tuesday’s Aug contract settlement of $341.05, up $5.65.