November 23

11/23 – In Friday’s Cattle on Feed report, the USDA said that new placements onto feedlots in October were down 11.0% from a year ago, following 4 straight months of strong placement increases. But despite the drop in placements, feedlot inventories – at 11.97M head - were 1.3% above a year ago, 2.2% above a month ago, and the highest Nov. 1st on record. The report should be neutral to mildly bullish for cattle prices. The real concern going forward into a very uncertain winter is that a Covid resurgence could once again hamper processing plant operations and lead to another round of supply chain disruptions. Vaccine timing will be a huge factor. Cattle futures that averaged $125.17/cwt in January, and plunged to $83.83 in April, have rebounded to $108.10/cwt. Forward contracts for 2021 are averaging $111.11, up 5.5% from a projected average of $105.35/cwt for 2020.