Latest cattle reports hint at expansion slowdown

Economist says USDA omission of midyear inventory report reduces information needed for decision-making.

The July Cattle on Feed report confirms the feedlot situation continues to improve in 2016.

That's the analysis of Derrell S. Peel, Oklahoma State University Extension livestock marketing specialist.

Peel notes feedlot placements in June were up year-over-year, but less than expected at 103% of last year's level.

June marketings were as expected at 109% of last year, and the largest June marketing level since 2012.

READ: Top 10 issues facing beef producers

The July 1 feedlot inventory was 101% of last year, up slightly less than expected as a result of the smaller placements.

Peel says the result of herd expansion in 2014 and 2015 was a Jan. 1, 2016, year-over-year increase in feeder cattle supplies by an estimate of 5.3%. Those feeder cattle began showing up in feedlots the past five months with year-over-year increases in placements.

He adds that, since February, feedlots have placed 572,000 more cattle compared with the same period last year. In that same time period, feedlots have accelerated marketings to clean up the backlog that crashed fed cattle markets in late 2015. Feedlot marketings since February have increased by 478,000, compared with the numbers one year ago. This means with the increase in marketings nearly matching the increase in placements, feedlot inventories are growing only slowly, Peel adds.

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