September Kansas Feedlot Marketings Plummet

The number of fed cattle sold to beef packers from the “average” Kansas feedlot in September took an uncharacteristically large tumble, dropping to the lowest monthly total of the year so far, according to data collected by the Kansas State University Extension service.

The data is collected each month from select feedlots around the state, chosen to give a representation of how cattle performed and management activities in a given month.  The data is given to the Livestock Marketing Information Center in Denver for compilation into the “average” Kansas feedlot and is graphed and published on the LMIC website.

 

SEPTEMBER MARKETINGS FALL

 

September marketings to beef packers from that average Kansas feedlot fell to 2,597 head, down 2,841, or 52.2%, from 5,438 a month earlier, down 2,168, or 45.5%, from 4,765 a year earlier and down 1,681, or 39.3%, from the 2016-2020 average of 4,278 head.

The move makes September’s Kansas feedlot marketings the lowest monthly total for the year and substantiates anecdotal evidence that US feedlot inventories of slaughter-ready cattle are thinning, a market analyst said.

What makes the September move ominous for the consumer is that monthly Kansas feedlot marketings typically decline in October and could drop further in November before rising again in December, the analyst said.  This would make fed cattle prices higher in coming weeks, but would make an attempt at pushing wholesale and retail beef prices to compensate for the shorter supply as inflation already is taking a bite out of consumer pocketbooks.

 

FINAL WEIGHTS, FEEDING TIME UNREMARKABLE

 

The final sale weight and days on feed of the cattle sold to beef packers in September showed nothing remarkable, the analyst said, indicating there was no rush to sell cattle particularly early.

The average sale weight of fed cattle exiting Kansas feedlots in September was 1,439 pounds, the same as in August but up 35, or 2.49%, from September 2021’s 1,404 pounds and up 22.2, or 1.57%, from the previous five-year average of 1,416.8 pounds.

Exit weights typically make only small adjustments from August to September but tend to rise in October and November before dipping in December.  Last year, final weights made an unseasonal decline in August and September only to jump sharply in October, dip slightly in November and rise again in December.

Average days of feed also was nothing special.  The average steer sold to Kansas packers in September spent 173 days on feed, following the 2016-2020 trend while maintaining its position higher than the average.  September days were down seven, or 3.89%, from August’s 180 but up 14, or 8.81%, from last year’s 159 and up 5.3, or 3.22%, from the average of 167.6.

 

CATTLE, BEEF RECAP

 

The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $150.00 to $154.40 per cwt, compared with last week’s range of $145.28 to $153.00.  FOB dressed steers, and heifers went for $233.15 to $239.26 per cwt, versus $228.72 to $239.18.

The USDA choice cutout Thursday was up $1.71 per cwt at $265.18 while select was down $0.10 at $233.06.  The choice/select spread widened to $32.12 from $30.31 with 103 loads of fabricated product and 26 loads of trimmings and grinds sold into the spot market.

The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $2.15 to $2.25 a bushel over the Dec futures and for southwest Kansas were steady at $1.00 over Dec, which settled at $6.79 1/4, down 8 1/4.

The CME Feeder Cattle Index for the seven days ended Wednesday was $177.63 per cwt up $0.34.  This compares with Thursday’s Nov contract settlement of $178.00, down $0.92.