March 20

3/20 - In Friday’s monthly cattle report, the USDA said feedlot inventories totaled 11.6M head on March 1, down 4.5% from a year ago. New placements onto feedlots in Feb were down 7.2%. In March’s WASDE, the USDA projected a huge 6.0% drop in beef production for 2023. The USDA raised its forecast 2023 cattle prices from $159.00 to $162.00/cwt, up 12.1% from $144.40 for 2022. CME cattle futures set fresh 8-year highs at $167.50/cwt on 2/28 and remain elevated at $162.33 (3/17). Forward contracts are averaging roughly $160/cwt for the balance of 2023, and $170 for 2024. Seasonally, beef prices are already off to the races ahead of the “big 3” spring grilling holidays of Memorial Day (5/29), Father’s Day (6/18), and July 4th. A developing El Niño weather pattern should bring more moisture this spring to both crops and gazing pasture, and potentially lower the cost to raise cattle.