Tuesday, November 29, 2022

Huge Placements = Bearish On-Feed Report

by

On Feed January 1

USDA Actual:  105{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Average Guess:  104.0{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Guess Range:  103.0-105.0{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Placed in December

USDA Actual:  116{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Average Guess:  113.5{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Guess Range:  103.0-120.5{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Marketed in December

USDA Actual:  105{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

Average GuesS:  105.0{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}


Guess Range:  103.0-107.0{b5a992b8e63762954627fabd02ae0ce4cbdce5a7319b086354586c608f95fa42}

The January 1 Cattle on Feed report released on Friday looks a bit negative with the December placement total several points above the average trade guess. This fact could initially weigh on deferred live cattle futures, especially given their historically large premiums.

Having said that, the size of last month’s in-movement (i.e., 1.795 million head, 16 percent larger than last year and 10 percent greater than the 3-year average) fits well within the entire range of guesses. The trade was expecting a big placement, and they got one with just a little extra frosting.

But if the late-year placement was not a big shocker, the weight breakdown may give bears a little additional ammunition. Specifically, the placement was more front-loaded than most anticipated with the use of 8-weight feeder steers and heifers 29 percent greater than 2009 and 24 percent larger than the 3-year average.

Suddenly, the spring marketing chore looks more demanding than previously thought. According to the DTN placement model, big lots now have approximately 1.9 million scheduled to finish in April, 4 percent more than 2010 (but still 3 percent below the 4-year average).

The marketing total was fully anticipated but nonetheless impressive at 1.827 million, 5 percent larger than 2009 (even with one fewer business day), 8 percent greater than the 3-year average, and the most aggressive late year out-movement since 1999.

For more Harrington comments check out www.feelofthemarket.com.

 

© Copyright 2011 DTN/The Progressive Farmer, A Telvent Brand. All rights reserved.

Posted with DTN Permission by Haylie Shipp

 

 

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