The Daily Livestock Report
CME analysts offer an estimate of Friday, Dec. 21, cattle-on-feed report.
Analysts expect USDA’s December Cattle-on-Feed Report, due out on Friday afternoon, Dec. 21, to continue the pattern of the past few months, indicating lower cattle numbers in the surveyed feedlots. The results of the Dow Jones pre-report survey of analysts appear in the graphs accompanying this article.
As has been the case with the last several reports, most attention is likley to focus on the placement number, given the U.S. pasture and range conditions and progressively smaller calf crops. Relative to recent months, analysts expect this month’s number to be closer to the 2012 level.
Should the analysts’ average prediction of 93.4% of the year-ago level be true, it would imply the smallest year-on-year reduction in both actual numbers and percentage since June. For some time, we noted that this year’s numbers were being compared to unusually large numbers last year, but it is important to note that last year’s placements in both October and November were VERY close to the five-year average, meaning, though large, they were not unusually so. Further, the range of the analysts’ estimates is not large — at least for this number, which sometimes sees widely divergent predictions — suggesting some degree of consensus for November placements. The estimate range implies placements of 1.7 to 1.8 million head.
Should the average estimate for year-on-year change in feedlot inventories (93.4%) be true, the Dec. 1 number will be 11.259 million head, the smallest December number since 2002. Plus, where placements got closer to year-ago levels in October and are expected to do so again in November, the feedlot inventory is getting farther and farther from the levels of both last year and the 2006-2010 average. The reason, of course, is that the inventory of cattle in these lots is the cumulative result of these smaller placements. It is important also to note that the first of those smaller placements vs. one year earlier occurred in July, and those cattle will not, for the most part, be in the slaughter mix until January or later. Bottom line: We still haven’t seen the impacts of these lower feedlot numbers in steer and heifer slaughter.
Look for a recap of the Cattle-On-Feed Report in Monday’s Daily Livestock Report. You can subscribe at www.dailylivestockreport.com.
