USDA cattle numbers show no sector in the black

Almost no one in the cattle industry is making money right now.

Almost no one in the cattle industry is making money right now. The USDA reports marketings out of feedlots are down six percent from a year ago, the lowest in at least 13 years. That would normally push cattle prices up. USDA livestock analyst Shayle Shagum says, “Except we are looking at this weakening demand situation. Currently, we have cattle that are selling in the mid-70, mid to upper 70 dollar range.” Last year at this time it was 88 to 89 dollars a hundred weight. The number of cattle and calves in feedlots starting this month were very low at 11.3 million head - the lowest in five years.

Shagum says cattle feeders right now are below break even and none of the beef sectors are doing well, “Packer margins had been high until recently but we have seen them deteriorate. Cow-calf operators, obviously, saw poor returns last year given the fact that they’re gonna have their feeder cattle prices pushed down in the first part of this year, it’s probably going to take awhile for those returns to recover as well.”

As beef supplies go down, prices could pick up late in the year, but Shagum says it all hinges on the economy and whether consumer demand will pick up.

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