Cattle Placements Rose Above Expectations in October
November 17 2017 - 4:42PM
Dow Jones News
By Benjamin Parkin
Feedlots placed more cattle than expected in lots for fattening
last month, suggesting that beef supplies will continue to grow
next year.
The U.S. Department of Agriculture said Friday that feedlots
placed 2.39 million cattle on-feed in October, a 10% increase from
a year earlier and above the 8% increase forecast by analysts.
That was the highest figure for October since 2011, said Terry
Reilly of Futures International, adding that the report was
negative for cattle prices but positive for feed demand. Feedlots
will need to secure more grain in order to fatten the extra
livestock.
The total number of cattle on-feed on Nov. 1 of 11.3 million was
6% higher than a year earlier, in line with pre-report
expectations. Cattle marketed, or sent to slaughterhouses, in
October rose 6% year-over-year, also in line with expectations.
Market participants expected a limited reaction to the report
when futures trading resumes on Monday. The USDA has frequently put
its monthly cattle placement figures above analyst expectations,
but traders are betting that demand will be strong enough to absorb
the extra beef.
"It shouldn't lead to too much excitement out of the gate on
Monday," said Tyler Keeling, a broker at Amarillo Brokerage in
Texas.
Cattle futures for December closed 0.6% lower at $1.1885 a pound
at the Chicago Mercantile Exchange before the cattle on-feed report
was released Friday afternoon. Futures fell 1.4% over the week.
Much of the pressure on futures this week came from lower cash
prices for physical cattle. Prices fell $4 to $5 from a week
earlier.
Mr. Keeling said the U.S. Thanksgiving holiday should limit
activity in the cattle market next week.
"All the traders will go home pretty quick, once they get the
cash out the way," he said.
Write to Benjamin Parkin at benjamin.parkin@wsj.com
(END) Dow Jones Newswires
November 17, 2017 16:27 ET (21:27 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.