May 28

5/28 - In Friday’s cattle report, the USDA said feedlot inventories on May 1st were 11.65M head, down 0.9% from a year ago. New placements onto feedlots in April were down 5.8%, and marketings up 10.1%. The higher demand for finished cattle, combined with the steep drop in placements, should be bullish for cattle prices. On a positive note: The USDA reported just 13% of the U.S. cattle herd is located in drought areas, compared to 37% a year ago. Good spring pasture conditions would go a long way toward discouraging further herd liquidation. In May’s WASDE, the USDA projected beef production declines of 1.4% in 2024 and 5.5% in 2025, and those come on top of a 4.7% decline in 2023. Year-to-date cattle futures prices are running 10.2% above 2023 levels. Looking to next year: the USDA is forecasting cattle prices to average a record-high $188.00/cwt in 2025, up from a projected $183.51 in 2024.