By Jamie Martin
The U.S. cattle industry might be on the brink of expansion after years of contraction, as suggested by the recent Cattle on Feed Report. Economist Bernt Nelson from the American Farm Bureau Federation highlighted key findings from the report.
"The USDA estimates there were a little bit over 11-and-a-half-million head of cattle in the U.S. in feed lots on March 1. This number’s down about two percent from last year," he explained.
The significant decrease in cattle placements, which dropped 18% from the previous year, sparked discussions about potential herd growth.
Nelson remarked, "Placements came in at 1.55 million head, down a whopping 18 percent from last year, and so that starts to ask the question, could this be a sign of some herd expansion?"
The response in the livestock markets was noticeably bullish, with futures markets initially rallying, reflecting optimism but also acknowledging underlying economic uncertainties and market volatility. "Overall, this was a pretty bullish report. Futures markets rallied early on, with several contracts hitting new highs before they kind of fell off," Nelson noted.
As the summer grilling season approaches, the impact on beef prices and availability is anticipated. Nelson added, "But when we see placements of cattle on feed dropping now, that means we're going to have fewer cattle available later for marketing in the summer, and this has the potential to tighten beef supplies even further as we kind of go into grilling season." This trend suggests that consumer demand will play a crucial role in shaping market dynamics in the coming months.
Photo Credit: usda
Categories: National