As the feedlot inventory continue declining with the December USDA Cattle on Feed report, Derrell Peel, Oklahoma State University livestock marketing specialist, said in a letter called Cow-Calf Corner that feedlot production was dropping quickly.
FEEDLOT POPULATION DROPPING
The December On-Feed report showed a feedlot inventory of 11.727 million head, down 2.1% year over year and the smallest December feedlot inventory since 2017, Peel said.
Feedlot inventories have declined year over year for 13 straight months, leading to the lowest 12-month moving average since October 2018, he said. Average feedlot inventories have declined 3.6% from the peak in September 2022.
The rather slow decline in feedlot inventories masks a sharper drop in feedlot placements and marketings, Peel said. Feedlot placements in November were down 11.2% year over year and have decreased 8.6% in the last six months.
Marketings in November were down 11.8% from a year earlier and have decreased 7.9% in the last six months compared to 2024, he said.
MOVING AVERAGE DECLINE
The 12-month moving average annual trends for placements and marketings through November showed that average feedlot placements the past year were the lowest since April 2016, Peel said. And, average marketings were the lowest since August 2016.
Average feedlot placements and marketings decreased more dramatically in 2025 as tightening feeder supplies were exacerbated by the lack of Mexican cattle imports, he said.
The regional changes were significant, he noted. Feedlot inventories in Texas were smaller than Nebraska for October and November, which has only happened a few times since 1971.
A table of current on-feed inventories and feedlot placement totals for the six months through December for the top eight cattle feeding states showed placements decreased 16.2% year over year in Texas compared with 7.2% in Nebraska.
December feedlot inventories were down 9.4% in Texas but actually up 2.7% year over year in Nebraska, Peel said. Colorado, the number four cattle feeding state, also dropped sharply with the six-month total of placements down 21.8%, and the on-feed total for December was down 14.2% compared with a year earlier.
Kansas feedlot inventories in December were up just 0.8% with June-November placements down 5.6%. Iowa’s on-feed inventory in December was up 6.1% from a year earlier with June-November placements up 4.1%.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $231.21 per cwt to $235.55, compared with last week’s range of $228.00 to $236.00 per cwt. FOB dressed steers and heifers went for $362.42 per cwt to $366.74, compared with $359.10 to $363.90.
The USDA choice cutout Wednesday was up $0.54 per cwt at $358.53 while select was up $0.47 at $357.65. The choice/select spread widened to $0.88 from $0.81 with 93 loads of fabricated product and 36 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef as $401.41 per cwt, and 50% beef was $143.75.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $0.95 to $1.10 a bushel over the Mar corn contract, which settled at $4.22, up $0.02 1/4.
The CME Feeder Cattle Index for the seven days ended Tuesday was $369.69 per cwt, up $0.57. This compares with Wednesday’s Jan contract settlement of $364.75, down $1.52.