Cattle on Feed & December Cattle Price Range Forecast – 07/23/2022

Cattle feedlot managers sharply curtailed feeder cattle placements last month while increasing finished cattle sales. The number of cattle on feed July 1 remained fractionally larger than a year ago. High feed costs have discouraged cattle placements this year despite finished cattle returns in the upper end of the recent 25-year range. Recent placement history suggests finished cattle sales over the next six months will decline 1% year over year.

We expect December live cattle to trade between $140 and $155 through contract expiration. We have provided two scatter studies displaying the historic high and low for December cattle as a function of the domestic per capita beef supply in the last quarter of the year. The point marked in red represents the USDA’s most recent beef supply forecast and the close for December cattle on 7/22/2022.