Once again, feedlots (capacity of 1,000 head or more) placed more cattle on feed than most analysts were expecting, according to Friday’s monthly Cattle on Feed report.
There were 1.82 million head placed on feed in February, which was 7.3% more than the previous year. That’s at least 3% more than most estimates heading into the report. In terms of weight composition, 36.3% went on feed weighing 699 pounds or less; 52.7% weighing 700-899 pounds; 11.1% weighing 900 pounds or more.
Marketings in February of 1.68 million head were 1.64% more than last year, which was about in line with expectations.
Total cattle on feed March 1 of 11.72 million head was 8.8% more than the previous year, which was about 1% more than most projections ahead of the report.
That’s with expectations for significant erosion in cattle feeding returns, on a cash to cash basis.
“Current projections indicate losses spanning April to November consistent with higher placement prices relative to expected sales prices,” according to the March Historical and Projected Kansas Feedlot Net Returns (KFNR) from Kansas State University.
The most recent KNFR projects net returns of steers at -$96.90 per cwt (May) to -$161.17 (June) from April through July. That’s with projected breakeven fed prices of $121.24 per cwt (July) to $129.30 (May) and breakeven feedlot cost of gain at $57.75 per cwt (June) to $70.40 (May).
Keep in mind that these projections represent a cash basis with no price risk management.