News

June cattle placements up 16%, total herd 4% larger

The USDA says placements of cattle on feed in June were extremely aggressive.

Placements were up 16% from June 2016 at 1.770 million head, a lot more than what many analysts were expecting, because of expectations for declining feed costs and improved pasture conditions. Most of those cattle will head to market later this winter or early next spring.

Marketings during June were 4% above a year ago at 1.989 million head, the 11th month in a row with an increase, thanks to good margins and beef demand.

The total number of cattle on feed as of July 1st was up 4% on the year at 10.821 million head.

The cattle inventory was 4% more than on July 1st, 2015 at 102.6 million head, with last summer’s report suspended in a budgetary move. The expansion came despite the Spring wildfires and current drought conditions in parts of the Plains.

All cows and heifers that have calved came out at 41.9 million head, up 5% from last year, with beef cows at 32.5 million head and milk cows at 9.4 million, up 7% and 1%, respectively. Heifers weighing more than 500 pounds were pegged at 16.2 million head, 3% higher, with beef replacement heifers at 4.7 million, down 2%, milk replacement heifers at 4.2 million head, unchanged, and others at 7.3 million head, a 9% increase.

Steers weighing more than 500 pounds were 14.5 million head, 3% more than a year ago, with bulls at 2 million head, up 5%, and calves weighing less than 500 pounds were 28 million head, also up 5%.

The 2017 calf crop is expected to be up 3% from 2016 at 36.3 million, with a year to year growth of 4% during the first half of 2017, to 26.5 million head.

Since they indicate a bigger herd and more beef, the numbers look bearish for cash and futures trade, but may already be factored in because of futures’ current discount to recent cash business.