The U.S. Department of Agriculture’s latest “Cattle on Feed” report was mostly in line with trade expectations. Cattle and calves on feed for the slaughter market in the U.S. for feedlots with capacity of 1,000 head or more totaled 11.1 million head on Aug. 1, 2024. The inventory was only slightly above last August and in line with pre-report trade estimates.

Placements in feedlots, on the hand, came in higher than the trade had expected. During July, USDA said 1.70 million head were placed, 6% above 2023. The average pre-report trade estimate was for a 3% increase.

Net placements were 1.65 million head. During July, placements of cattle and calves weighing less than 600 pounds were 390,000 head; 600-699 pounds were 265,000 head; 700-799 pounds were 385,000 head; 800-899 pounds were 387,000 head; 900-999 pounds were 200,000 head, and 1,000 pounds and greater were 75,000 head.

The report included the quarterly breakdown of steers and heifers in feedlots. The number of steers on feed was 1% higher than last year, while the heifer inventory was nearly unchanged. Oklahoma State University Extension livestock marketing specialist Derrell Peel said the heifer inventory confirms that heifers continue to be placed in feedlots. As of July 1, heifers made up just shy of 40% of total feedlot inventories, which Peel said is near the highest levels in the past 20 years. 

“The heifer percentage of feedlot inventories drops below the average level (36.7%) during periods of heifer retention and herd rebuilding and is above average during periods of herd liquidation,” Peel explained.

Marketings of fed cattle, USDA said, totaled 1.86 million head during July, 8% above 2023. This was in line with what the trade had estimated.

USDA livestock analyst Shayle Shagam said the U.S. still has relatively large numbers of cattle on feed, “which will help supply cattle for slaughter in the coming months.”

As for the cattle cycle status and whether herd rebuilding has begun, Shagam said the report didn't really provide any further information.

Peel pointed out that the current feedlot inventories mask the continued decline in feeder cattle in the U.S. Figure 1 shows the U.S. calf crop from 2008 to 2023, along with a projected 2024 calf crop of 33.1 million head. At that level, Peel said the total calf crop is down 3.22 million head from the 2018 cyclical peak. As such, the projected 2024 calf crop is the smallest total U.S. calf crop since about 1941 (based on estimated calf crops prior to 1960), he pointed out. That figure includes beef and dairy, so straight-bred dairy as well as beef-on-dairy crossbred calves are included in this total calf crop.

Nearby live cattle and feeder cattle futures closed higher Monday at $242.575/cwt. and $182.575/cwt., respectively. However, December live cattle future closed lower at $175.200/cwt.