On-Feed Report Seen Nearly Flat

The US Department of Agriculture is scheduled to release its monthly Cattle-On-Feed report today, and traders expect the number of cattle populating US feed yards to be nearly flat with a year ago and up from October.

Analysts surveyed by Reuters said they expected the report to show 10.564 million head munching feed as of Nov. 1, up 506 million, or 5.03%, from October as it follows a seasonal trend.

The expected number on feed would be only 21,000 head, or 0.20%, below Nov. 1, 2013.

But a year ago, the value of boxed beef was 22.4% below current levels, illustrating the degree to which packers have been able to push product values over the last year.

If on-feed numbers follow a seasonal trend, they should continue rising in December, but at a slower pace, only to begin falling off in January.




The number of cattle placed into feedlots in October was expected to decline from a year ago to 2.283 million head, a dip of about 4% from a year earlier.  As with the total number of cattle on feed, this number would represent an increase from the October figure.  At that time, placements were put at 2.007 million head, so the November placements would represent a monthly increase of 276,000 head, or a 13.5%, increase over October.

However, the expected placement number would fall short of the previous five-year average of 2.394 million.

If placements continue to follow the seasonal pattern, this report should show a seasonal peak as weaning and movement of cattle subsides into winter.  Placements may not show a monthly increase until March as cattle come off wheat pasture and are sold to feeders for further growth and fattening for slaughter.




The number of cattle sold, or marketed, to packers in October also is expected to be down from a year ago, but up from September.

The Reuters survey showed average expectations of marketings at 1.699 million head, a 7% decline from a year earlier, but an increase of 16,000 head, or 0.95%, from a month earlier.

Such a monthly boost would more closely resemble the five-year average than last year.  The average increase is only 156,000 head, or 0.89%, while last year’s increase was 135,000 head, or 7.98%.

If the pace of marketings follows the normal path, they will fall away in the December report only to rise again in the January data.




Cash cattle trading this week appears to be awaiting some sort of news to move it forward.  No action in the Plains has been reported with bids from packer buyers at $167 to $168 per cwt on a live basis and asking levels around $174.

Last week, cattle traded at mostly $170, and sources say that with this week’s cold temperatures setting cattle back, that packer buyers will have to open their wallets.  Most think a steady $170 would be the minimum acceptable bid, although buyers are reluctant to pay up since they are buying for a holiday-shortened work week.

Boxed beef prices Thursday were up again, adding to feedlot resolve to obtain at least steady prices.  The choice beef cutout was up $0.60 per cwt to $255.39 while the select cutout was up $0.94 to $242.99.  There were 97 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Wednesday was $239.97, down $0.13 from Tuesday.  The soon-to-expire Nov futures contract settled Thursday at $240.42, down $0.12. to-expire Nov future