Cattle Backlog May Not Be As Large As Feared

The number of market-ready cattle backlogged in feedyards may not be as large as previous estimates. While any tally of cattle currently waiting on available shackle space is – at best – an estimate, an analysis of 2020 Cattle on Feed and slaughter data from USDA suggests industry estimates of 1 million cattle backlogged may be overstated by as much as 50%. “After a closer analysis of the flow of cattle through feedlots from Cattle on Feed reports, steer and heifer slaughter, and packing plant capacity utilization, I believe the 1 million head backlog figure is too large,” says Sterling Marketing president John Nalivka, Vale, Ore. “Instead, the backlog in feedlots from the April slowdown is probably closer to 400,000 to 550,000 head.” In developing his estimate, Nalivka notes there were 11.8 million cattle on feed March 1, which was about unchanged from 2019. Feedlots placed 23% fewer cattle during March, resulting in a total supply of 3% fewer in March than in 2019 (about 425,000 head). During March, steer and heifer slaughter increased 13% from the prior year with packers using an estimated 92% of fed cattle slaughter capacity, according to Sterling Marketing. That capacity use compares to 85% during March of 2019, a significant difference, Nalivka says...MORE