Amarillo-fed Choice slaughter steers remained steadily in the $69-70 area in June. That represents a loss of about $1.75 from the previous month. In contrast, feeder cattle and calves improved slightly in the same period and averaged about $1 higher.
U.S. cattle and calves on feed for slaughter in feedlots with capacities of 1,000 head or more rose to 10.93 million head on June 1. This inventory was 9% above 1999 and the highest June level ever recorded since the new cattle feeding statistics series began in 1995.
Marketings of fed cattle in May reached 2.17 million head, 9% above May of last year and 11% higher than the 1998 level. These marketings also represented the largest May figure in the historical seven cattle feeding states during the last six years.
Feedlot placements in May increased to 2.3 million head, 12% greater than 1999 and the largest June figure in six years in the seven major feeding states.
The most substantial gain in placements of cattle and calves were those less than 600 lbs. Their total (382,000 head) represented an increase of 31%. The 600- to 699-lb. feeders totaled 470,000 head; the 700-799 lbs. totaled 794,000 head; and those 800 lbs. and greater totaled 658,000 head. Each of these weight groupings gained 8-10%.
What's Ahead? It may be difficult for fed cattle prices to show much improvement later this year. The reason is simple - we may have too many fed cattle marketings.
We did quite well in March and April when feedlot placements dropped below year-ago levels. May's 12% increase, however, could cause real problems as we move into the fall and early winter months.
Feeder cattle and calves will likely continue to demand good prices. Some summer weakness is expected but not much. Feeding costs are still cheap and supplies of available feeders will not increase for at least a year. The only problem continues to be the persistent drought affecting a large part of the cattle producing regions.