February 22

2/22 – In Friday’s Cattle on Feed report, the USDA said feedlot inventories on Feb 1st, at 12.1M head, were 1.5% higher than a year ago. New placements onto feedlots in Jan were up 3.2%. With feed costs elevated, economics favor keeping animals off-feed and on-pasture where possible – so the gain in placements was surprising. But that was Jan. Feb’s focus will be on the brutal winter weather that will result in cattle weight losses and deaths. Expect tons of spoilage where power losses hit homes, retailers, restaurants, and processors. Supply chain disruptions and restocking issues are likely for the next few weeks. Regarding beef, it means a little less supply available for spring/summer. So far, cattle futures at $115.92/cwt are averaging $116.05 for Feb vs. $114.38 for Jan. April futures are trading at $123.67/cwt vs. a Covid-diminished, April average of $90.38 in 2020.