January 24

1/24 - In Friday’s Cattle on Feed report, the USDA said feedlot inventories, at 12.04M head on Jan 1st, were up 0.6% from a year ago. New placements onto feedlots in December were 6.5% above a year ago, confirming large numbers of cattle moving off of dried-up pasture. Heifers (breeding stock) in feedlots accounted for 4.68M head or 38.9%, up 2% from 2021. Placements are soaring for younger, lower-weight cattle - who will require more time, and lots of expensive feed, to get them to slaughter weight. We are now entering a 4th year liquidation and contraction for cattle herds that is being compounded by drought. Cattle slaughter is projected to fall from 2022 through 2025. In Jan’s WASDE, the USDA projected a 2.8% decline in beef output for 2022. Cattle futures at $137.93/cwt (1/21) are 20.9% above a year ago and 13.2% higher than the 5-yr avg for this time of year.