September Cattle on Feed Estimate 09/18/2020

The USDA is scheduled to release the August Cattle of Feed data September 25, 2020. We estimate the on feed inventory at 11.2 million head which is up 2% from 11 million head a year ago and a record high for the date.

 The supply of finished cattle projects to be adequate to slightly surplus for the next six months. We have included an economic value study for 4th quarter deliverable steers. Note that December futures are trading about $8/cwt premium to the  USDA‘s fourth quarter projection ($104 in the September 2020 WAOB report)

The surprising bull markets in soybeans and corn will act as supporting forces in the cattle market as higher corn and soybean meal values will raise the cost for feedlots.