Two key numbers in Friday's USDA Cattle on Feed report came in on the market-friendly side of trade guesses. March placements, at 1.795 million head, were well below the average trade guess of around 1.916 million. The 10.860 million cattle  on feed April 1 were below the average trade guess of about 11 million. March marketings, at 1.660 million, were below the average guess of around 1.7 million head.
The dip in placements more than offset the shortfall in marketings to pull the April 1 on-feed inventory below trade expectations.
Still, fed beef supplies  will be rising seasonally, just as grilling season heats up. However, the rise will not be as large as some traders had earlier expected. Shifting expectations likely contributed to Friday's strong cattle futures closes.
The cattle situation reflects two different markets. The April 1 cattle on feed inventory is about the closest to the year-earlier level since August 2012. Since October last year, feedlots have placed about 500,000 more cattle on a year-on-year basis. Those forces all suggest a bit of a bulge in immediate fed cattle  supply.
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