Cattle Inventory Insights

By Andi Anderson

As the livestock market gears up for USDA's January 31st inventory estimates for 2024, a crucial aspect is the January Cattle-on-Feed Report, released on January 19th. The report provides valuable insights that analysts eagerly scrutinize, given its significant role in shaping market dynamics. 

The total feedlot inventory, standing at 14.4 million head, continues to surpass year-ago levels, maintaining a trend observed since October. This defies expectations, considering the shrinking cowherd over recent years. The report attributes this anomaly to increased live cattle imports, particularly from Mexico, which saw a notable surge in the fall. Larger cattle, possibly placed directly on feed, contributed to the heightened inventory. 

Placements, a key metric, were closer to expectations in recent months, registering a 4% decrease compared to the previous year, as per the January report. However, the impact of early domestic placements in September and October, influenced by fall weather, is still a factor to consider. 

Examining the total on-feed inventory reveals an intriguing factor – counter-seasonal increases in slaughter weights during the last months of the preceding year. This likely results from cheaper feed in the 4th quarter, extending the time cattle spend on feed. Elevated estimates of cattle on feed over 90 and 120 days point towards this trend. 

The steer-heifer breakdown as of January 1, 2024, indicates a higher number of heifers on feed compared to the last quarter and January 2023. Despite a slight decline in heifers as a percentage of on-feed inventory, hovering just under 40%, it does not suggest immediate expansion. This challenges the notion of ongoing heifer retention and indicates a cautious approach to expansion. 

Photo Credit: gettyimages-imaginegolf