Cattle and calves on feed for the slaughter market in the U.S. for feedlots with capacity of 1,000 head or more totaled 11.0 million head on Sept. 1, 2019. The inventory was 1% below Sept. 1, 2018, and in line with pre-report trade estimates.

The report showed that placements in feedlots during August totaled 1.88 million head, 9% below 2018. The trade had expected only a 5% decline. Net placements were 1.82 million head.

The U.S. Department of Agriculture reported that placements during August were 385,000 head for cattle and calves weighing less than 600 lb., 300,000 head for those weighing 600-699 lb., 424,000 head for those weighing 700-799 lb., 440,000 head for those at 800-899 lb., 230,000 head for those at 900-999 lb. and 105,000 head for those weighing 1,000 lb.-plus.

Marketings of fed cattle during August totaled 1.95 million head, 2% below 2018 and in line with average pre-report trade estimates.

Other disappearance totaled 61,000 head during August, 11% above 2018.

This is the first time since October 2014 that the inventory has been lower than the prior year, USDA’s Gary Crawford said.

USDA livestock analyst Shayle Shagam said it is hard to say if contraction of the nation's herd is ahead. He explained, “Part of it is going to depend on what cow/calf operators are looking at. At the moment, their margins are weak to negative. So, in that respect, you’re getting a signal that you probably don’t want to expand, but it’s not a very strong signal.”

As long as there is forage and grass, Shagam said producers may be taking a “wait-and-see” attitude, hoping the declining numbers could result in increasing prices.