Cattle on Feed Report & June live cattle Study

USDA reported a sharp drop in cattle feedlot activity in March 2024. Net feeder cattle placements declined 13% on a year over year basis. March finished cattle marketing declined 14%. The inventory of cattle on feed April 1, 2024  was 1% larger than a year ago.

Feedlot operators are feeding scare feeder cattle supplies to heavier weights to offset part of the feeder cattle expense. Weekly cattle carcass weights are running well ahead of the year earlier level reflecting the feedlot strategy of keeping cattle on feed longer.

We have included two scatter studies which plot the price range for June live cattle (adjusted for inflation)  as a function of the calculated US feeder cattle supply on April 1. We estimate the 2024 supply at 18 million head compared to 19 million head on April 1, 2023.

Based on previous years data 2024 June live cattle Futures (May June) would be expected to trade between $170 and $195/Cwt.. compared to the close on 4/19/24 of $176.