USDA estimated there were 11.823 million head of cattle in large feedlots (1,000-plus head) as of Jan. 1, down 107,000 head (0.9%) from year-ago and 71,000 head less than analysts expected. The drop in feedlot supplies was driven by a 3.3% decline in the number of cattle placed in December, with that category coming in below the bottom end of pre-report expectations. Note: Mexican feeder cattle were banned from entry into the U.S. during the entirety of December. Marketings increased 1.0% during December, modestly less than expected.
| Cattle on Feed Report | USDA (% of year-ago) | Average Estimate (% of year-ago) |
| On Feed on Jan. 1 | 99.1 | 99.7 |
| Placements in December | 96.7 | 101.1 |
| Marketings in December | 101.0 | 101.2 |
December placements were divided, with the lower three weight categories down from year-ago, while the upper three increased. Placements declined 9.2% for lightweight calves (under 600 lbs.), 7.3% for 6-weights and 1.3% for 7-weights. Placements increase 3.2% for 8-weights, 4.5% for 9-weights and 5.9% for heavyweights (1,000-plus lbs.). That should help fill some of the “hole” created by the ban in Mexican feeder cattle in late 2024 and early this year.
As of Jan. 1, the number of steers on feed totaled 7.248 million head, up 53,000 head (0.7%) from year-ago. Heifers in feedlots totaled 4.575 million head, down 160,000 head (3.4%). The decline in heifers could suggest the process of herd rebuilding may have started over the past quarter.
The placements figure is fully bullish, especially for deferred live cattle futures. With that said, futures rallied sharply into the report, so some of the bullishness may already by worked in.