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Cattle on Feed Report Preview    10/22  11:15

COVID-19 Disruptions, Higher Input Costs Continue to Haunt
 
Cattle Markets

By ShayLe Stewart
DTN Livestock Analyst

                      USDA Actual   Average Estimate       Range
On Feed Oct. 1                          103.3%      102.7-103.9%
Placed in Sept.                         102.5%       98.9-106.5%
Marketed in Sept.                       105.9%      104.9-106.7%

OMAHA (DTN) -- On Friday, USDA is expected to unveil another 
bearish Cattle on Feed report as the market balances more cattle 
on feed and more cattle heading into feedlots. 

The market's disruption from earlier this spring is still 
haunting the current cattle market, as are higher input costs 
from rising corn and hay prices and a lack of marketing options 
as wheat pastures are hard to come by. Therefore, buyers are 
pressured to send feeders directly into feedlots as other 
options are limited this year. 

The trend of more cattle on feed and more cattle being placed 
into feedlots will most likely continue through the end of 2020 
and, consequently, make the first and second quarters of 2021 
challenging, as the market will have to absorb those market-
ready cattle at that point.
 
On the bullish side for the cattle markets, the U.S. has been 
seeing strong export demand, which has helped move product and 
helped keep packers incentivized to keep rigorous kill 
schedules. But in order to keep the supply chain moving, the 
U.S. needs to see elevated demand on both the domestic and 
international side. The foodservice industry continues to be 
plagued with the hardship of COVID-19, which gravely affects 
domestic beef demand. 

Friday's Cattle on Feed report will most likely be bearish and 
could pressure both the live cattle and feeder cattle market.
USDA will release its Oct. 1 Cattle on Feed report at 2 p.m. CDT 
on Friday.

ShayLe Stewart can be reached at shayle.stewart@dtn.com


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