USDA Jan. 1 Cattle on Feed Report

By DTN Staff

OMAHA (DTN) -- Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 12.0 million head on Jan. 1, 2022. The inventory was 1% above Jan. 1, 2021. This is the second-highest Jan. 1 inventory since the series began in 1996, USDA NASS reported on Friday.

The inventory included 7.36 million steers and steer calves, down 1% from the previous year. This group accounted for 61% of the total inventory. Heifers and heifer calves accounted for 4.68 million head, up 2% from 2021.

Placements in feedlots during December totaled 1.96 million head, 6% above 2020. Placements were the highest for December since the series began in 1996. Net placements were 1.91 million head. During December, placements of cattle and calves weighing less than 600 pounds were 510,000 head, 600-699 pounds were 470,000 head, 700-799 pounds were 450,000 head, 800-899 pounds were 333,000 head, 900-999 pounds were 105,000 head, and 1,000 pounds and greater were 95,000 head.

Marketings of fed cattle during December totaled 1.86 million head, slightly above 2020. Marketings were the second highest for December since the series began in 1996.

Other disappearance totaled 54,000 head during December, 10% below 2020.

DTN ANALYSIS

"Friday's Cattle on Feed report is a direct representation of how drought and limited feed resources throughout the U.S. have affected cattlemen," said DTN Livestock Analyst ShayLe Stewart. "Seeing the 6% year-over-year increase in placements seems nearly impossible given that placements have been higher now in all the last three reports (higher on the January, December and November reports). But with wheat conditions unsuitable for grazing and drought starkly limiting winter grazing, where else were the cattle to go?

"But while it's baffling to see placements up 6% from a year ago, when analyzing the short-term and long-term trajectories of the market, cattlemen shouldn't become overly concerned given where the market is in its current cattle cycle. When closely studying the COF report, you'll note that the heightened placement numbers came from feeders weighing anywhere from under 600 pounds up to 899 pounds. The under-600-pound weight group saw a 50,000-head jump from a year ago, feeders weighing 600 to 699 pounds jumped 35,000 head from a year ago, feeders weighing 700 to 799 pounds increased by 25,000 head from 2021 and feeders weighing 800 to 899 pounds increased by 14,000 head. But for the weight groups of 900 pounds to 1,000 pounds or more, the numbers were either steady or less than a year ago.

"For the short term, this will likely have a negative effect on the markets early next week, as it's the largest placements have been for December since 1996. Whenever there is a new record, the market tends to back off in hesitation. But after absorbing the report, feedlots and cattlemen alike will realize that these feeders aren't going to pressure the markets anytime soon, as they need time on feed.

"For a deferred perspective, I don't find Friday's data overwhelming, as we know there are significantly fewer beef cows in our system producing calves for the market. If we were in a different scenario where our beef cowherd was growing, then the market may have trouble with throughput. But with demand as elevated as it is both domestically and internationally, the market will likely absorb these cattle with no trouble, especially if corn prices stay high, as feedlots will be marketing fats sooner rather than later."

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DTN subscribers can view the full Cattle on Feed reports in the Livestock Archives folder under the Markets menu. The report is also available at https://www.nass.usda.gov/….

	USDA Actual	Average Estimate	Range
On Feed Jan. 1	101%	99.7%	99.5-100.0%
Placed in December	106%	101.8%	100.0-104.7%
Marketed in December	100%	100.9%	100.2-102.1%

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