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Cattle on Feed Preview 11/20 12:28


Cattle on Feed Preview 11/20 12:28

USDA Actual Average Guess Range
Cattle on Feed:
On Feed Nov. 1 xxxxx 104.5% 103.5-105.5%
Placed in October xxxxx 99.0% 94.0-104.5%
Marketed in October xxxxx 104.0% 103.0-105.0%

In the interest of wrapping up cattle stats before Thanksgiving,
USDA will release the Nov. 1 bunk line count this Wednesday,
several days earlier than the normal monthly schedules.

Most expect the on-feed report to show a seasonal increase in
feedlot placements during October to the highest level of the
year. On the other hand, October placements probably slipped a
bit below last year's big in-movement (i.e., 10% larger than the
2016 placements and the largest October placements since 1999).

Fed steers and heifers marketed in October are projected at
104%-105% of a year ago. Much of the increase can probably be
explained in terms of one more marketing day last month than
October 2017.

Barring any major surprise, Wednesday's bottom line should put
the total Nov. 1 feedlot inventory a little over 11.75 million
head, or roughly 4% greater than last year. That would be the
largest November feedlot inventory since 2011.

Given the current premium structure of live cattle futures, the
board seems more braced to handle a bullish on-feed surprise
than a bearish one.

For more of John's commentary, visit http://feelofthemarket.com