Cattle on Feed Report Preview 10/22 11:15
COVID-19 Disruptions, Higher Input Costs Continue to Haunt
By ShayLe Stewart
DTN Livestock Analyst
USDA Actual Average Estimate Range
On Feed Oct. 1 103.3% 102.7-103.9%
Placed in Sept. 102.5% 98.9-106.5%
Marketed in Sept. 105.9% 104.9-106.7%
OMAHA (DTN) -- On Friday, USDA is expected to unveil another
bearish Cattle on Feed report as the market balances more cattle
on feed and more cattle heading into feedlots.
The market's disruption from earlier this spring is still
haunting the current cattle market, as are higher input costs
from rising corn and hay prices and a lack of marketing options
as wheat pastures are hard to come by. Therefore, buyers are
pressured to send feeders directly into feedlots as other
options are limited this year.
The trend of more cattle on feed and more cattle being placed
into feedlots will most likely continue through the end of 2020
and, consequently, make the first and second quarters of 2021
challenging, as the market will have to absorb those market-
ready cattle at that point.
On the bullish side for the cattle markets, the U.S. has been
seeing strong export demand, which has helped move product and
helped keep packers incentivized to keep rigorous kill
schedules. But in order to keep the supply chain moving, the
U.S. needs to see elevated demand on both the domestic and
international side. The foodservice industry continues to be
plagued with the hardship of COVID-19, which gravely affects
domestic beef demand.
Friday's Cattle on Feed report will most likely be bearish and
could pressure both the live cattle and feeder cattle market.
USDA will release its Oct. 1 Cattle on Feed report at 2 p.m. CDT
ShayLe Stewart can be reached at email@example.com
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