Analysts expecting sharp decline in cattle placements
The Cattle Site
20 March 2020
US - "Cattle on Feed" for February will be released today (Friday, 20 March). February was a leap year but slaughter days were identical to last year, according to Steiner Consulting Group, DLR Division, Inc.
Overall, analysts are expecting a sharp decline in placements relative to last year. The average pre-report estimate is down 7.6 percent, with a range from 11 percent to 2.9 percent below a year ago.
The drastic decline in placements is likely tied to nervousness in the market and the drastic declines in fed cattle prices in cash and on the futures market.
Cattle feeders looking to hedge would have found slim opportunities to lock in profits for cattle placed in February.
Cattle coming off of wheat pasture likely did not start until March and there are fewer on wheat pasture than a year ago.
The USDA NASS 1 January Cattle Inventory report estimated that this year has 15 percent fewer cattle than last year.
Placements may not look as low next month, but cattle feeders will still be looking at placing cattle against a futures board that shows fed cattle below breakeven at the time of placement. This could dampen placements moving forward as well.
Grass and green-up will be a key for the feeder cattle complex..
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