USDA Cattle on Feed Report Preview

OMAHA (DTN) -- Friday's USDA Cattle on Feed report could be the gift of support traders are looking for as they long for reassurance that the market is indeed supposed to trade higher in 2023.

The market's grind through the last couple weeks of 2022 has been fruitful, but it has been slow and lethargic. Both cattlemen and traders alike are hoping that with the added support of Wednesday's prosperous close -- February live cattle broke above the resistance at $157, and April live cattle closed above $160 at $161.17 -- the market will be able to continue to trade cash cattle at least steady, if not higher, with the potential that Friday's Cattle on Feed Report will be bullish.

Thankfully, the entire report is expected to be supportive, as on-feed numbers are projected to be lighter than a year ago, placement estimates are considerably lighter than a year ago, and marketings are projected to be at least steady, if not somewhat higher, than a year ago. Any decrease in on-feed numbers and placements will only add to the supportive nature of Friday's report. However, if placements are at the lower end of the range of analysts' estimates and only amount to 91.8% of a year ago (which is very likely), then next week's market should have no problem trading higher, as that's a significant decrease in numbers.

Now, yes, the market closes at its normal time on Friday and is closed on Monday, Dec. 26, but come Tuesday, Dec. 27 (the market's first day of trading after Christmas), traders should be able to use Friday's Cattle on Feed report if it's supportive to the fullest of it's potential.

USDA will release its Dec. 1 Cattle on Feed at 2 p.m. CDT on Friday.

	USDA Actual	Average Estimate	Range
On Feed Dec. 1		97.1%	96.5-97.6%
Placed in November		95.7%	91.8-98.0%
Marketed in November		100.9%	99.9-101.3%

ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com

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