Cattle Outlook January, 2018
Cattle Outlook January 2018 In This Issue: Supply Fundamentals Demand Fundamentals Summary 2
Historical Price Reference Where are Cattle Prices Currently, And Where are they Historically? 3
Historical Price Reference 4
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January 2017 Cattle Inventory Report
1867 1871 1875 1879 1883 1887 1891 1895 1899 1903 1907 1911 1915 1919 1923 1927 1931 1935 1939 1943 1947 1951 1955 1959 1963 1967 1971 1975 1979 1983 1987 1991 1995 1999 2003 2007 2011 2015 140,000,000 January Cattle Inventory 1867-2017 Cattle Inventory 2017 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 Total cattle and calves in the United States as of January 1, 2017 was estimated to be 93.6 million head. According to NASS this is 2% more than the 91.9 million head on January 1, 2016
Cattle Inventory by Class and Calf Crop - United States: January 1, 2016 and 2017 Class 2016 2017 Percent of previous year (1,000 head) (1,000 head) Cattle and calves 91,918.0 93,584.6 101.8% Cows and heifers that have calved 39,476.2 40,559.2 102.7% Beef cows 30,165.8 31,210.2 103.5% Milk cows 9,310.4 9,349.0 100.4% Heifers 500 pounds and over 19,907.3 20,052.0 100.7% For beef cow replacement 6,340.2 6,419.2 101.2% Expected to calve 3,936.6 4,000.2 101.6% For milk cow replacement 4,814.0 4,754.0 98.8% Expected to calve 3,111.6 3,071.6 98.7% Other heifers 8,753.1 8,878.8 101.4% Steers 500 pounds and over 16,315.4 16,353.5 100.2% Bulls 500 pounds and over 2,142.4 2,233.6 104.3% Calves under 500 pounds 14,076.7 14,386.3 102.2% Cattle on feed 13,157.0 13,067.0 99.3% Percent of 2015 2016 previous year Calf crop 34,086.7 35,082.7 102.9% 9
July 2017 Cattle Inventory Report
1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 160,000,000 July Cattle Inventory 1973-2017 Cattle Inventory 140,000,000 2017 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 Total cattle and calves in the United States as of July 1, 2017 was estimated to be 102.6 million head. According to NASS this is 4.5% more than the 98.2 million head recorded as of July 1, 2015. The July survey was not conducted in 2013 or 2016. 11
Cattle Inventory by Class and Calf Crop - United States: July 1, 2015 and 2017 Class 2015 2017 Percent of previous year (1,000 head) (1,000 head) Cattle and calves 98,200 102,600 104.5% Cows and heifers that have calved 39,800 41,900 105.3% Beef cows 30,500 32,500 106.6% Milk cows 9,300 9,400 101.1% Heifers 500 pounds and over 15,700 16,200 103.2% For beef cow replacement 4,800 4,700 97.9% For milk cow replacement 4,200 4,200 100.0% Other heifers 6,700 7,300 109.0% Steers 500 pounds and over 14,100 14,500 102.8% Bulls 500 pounds and over 1,900 2,000 105.3% Calves under 500 pounds 26,700 28,000 104.9% Cattle on feed 12,100 12,800 105.8% Percent of 2015 2,017 previous year Calf crop 34,087 36,300 106.5% 12
December 2017 Cattle on Feed
December 2017 Cattle on Feed Estimates On-feed December 1 Placed in November Marketed in November Average of Range of Estimates Estimates 106.7 105.6-107.4 105.8 99.2-111.0 103.2 101.6-103.5
December Cattle on Feed Number of Cattle on Feed, Placements, Marketings, and Other Disappearance on 1,000+ Capacity Feedlots - United States: December 1, 2016 and 2017 Item Number Percent of 2016 2017 previous year (1,000 head) (1,000 head) (percent) On feed November 1 10,665 11,332 106.25% Placed on feed during November. 1,843 2,099 113.89% Fed cattle marketed during November... 1,787 1,844 103.19% Other disappearance during November.. 69 71 102.90% On feed December 1...... 10,652 11,516 108.11%
December Cattle on Feed Number of Cattle Placed on Feed by Weight Group on 1,000+ Capacity Feedlots by Month - States and Untied States: 2016 and 2017 During November 2016 State Under 600 lbs 600-699 lbs 700-799 lbs 800-899 lbs 900+ lbs 1 900-999 lbs 1,000+ lbs Total (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) Colorado. 45 35 25 15 20 (D) (D) 140 Kansas.. 55 90 110 75 40 (D) (D) 370 Nebraska 120 150 85 90 65 (D) (D) 510 Texas. 105 95 125 45 20 (D) (D) 390 Other States. 145 120 80 50 38 (D) (D) 433 United States.. 470 490 425 275 (X) 100 83 1,843 During November 2017 State Under 600 lbs 600-699 lbs 700-799 lbs 800-899 lbs 900+ lbs 1 900-999 lbs 1,000+ lbs Total (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) (1,000 head) Colorado. 45 40 30 20 15 (D) (D) 150 Kansas.. 70 105 125 80 40 (D) (D) 420 Nebraska 115 150 100 90 90 (D) (D) 545 Texas. 180 130 110 45 15 (D) (D) 480 Other States. 200 120 90 59 35 (D) (D) 504 United States.. 610 545 455 294 (X) 75 120 2,099 (D) Withheld to avoid disclosing data for individual operations (X) Not applicable 1 The 900+ weight group is the sum of 900-999 and 1,000+ pound weight group
Current Supply Side
1,000 Head Fundamental Backdrop 700 Weekly Beef Slaughter Current Vs. Previous Vs. 5 Year Average 650 600 550 500 450 5 Year Avg 400 2017 350 7-Jan 27-Jan 16-Feb 7-Mar 27-Mar 16-Apr 6-May 26-May 15-Jun 5-Jul 25-Jul 14-Aug 3-Sep 23-Sep 13-Oct 2-Nov 22-Nov 12-Dec 2016
Dressed Weight Pounds Fundamental Backdrop 880 Cattle Dressed Weights January 2001 - Present Plotted Seasonally 860 840 820 800 780 760 740 720 700 Prod. Sold (Totals/Wtd Avg) Dressed Wgt. 2016 2017 YTD Poly. (Prod. Sold (Totals/Wtd Avg) Dressed Wgt.) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 0 10 20 30 40 50
Million Pounds Fundamental Backdrop 550 Weekly Beef Production Current Vs. Previous Vs. 5 Year Average 500 450 400 350 5 Year Avg 2016 2017 300 7-Jan 27-Jan 16-Feb 8-Mar 28-Mar 17-Apr 7-May 27-May 16-Jun 6-Jul 26-Jul 15-Aug 4-Sep 24-Sep 14-Oct 3-Nov 23-Nov 13-Dec 2-Jan
Current Demand Side
1,000 Pounds Fundamental Backdrop Annual Beef and Veal Exports Annual Exports 2000-2018 2017 Export Projection 2018 Export Projection 3500000 3000000 2500000 2000000 1500000 1000000 500000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 The December 2017 WASDE Report had Annual Beef & Veal Exports estimated to be 2,875 million pounds in 2017, up 20 million from November, and project 2018 to be 2,985 million pounds, up 15 million from last month.
Thousand Pounds Fundamental Backdrop 300000 Total Beef & Veal Exports 2007 - October 2017 (Carcass weight in thousands) 10-Yr Avg 10-Yr Max 10-Yr Min 2017 2016 250000 200000 150000 100000 50000 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec U.S. Beef & Veal Exports for October were 260.0 million pounds, an increase of 17.0 million pounds, or 7.0% more than September, and were 30.1 million pounds or 13.1% greater than October of 2016. (November ERS exports will be updated January 8 th )
600000 Fundamental Backdrop Cold Storage Total Beef 2007 - November 30, 2017 550000 500000 450000 400000 10-Year Avg 350000 10-Year Max 10-Year Min 2017 300000 2016 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Beef in Cold Storage as of November 30, 2017 was reported to be 487.0 million pounds, a decrease of 20.1 million pounds or 4.0% less than October and compares to the average 2.1% build from October to November over the past ten years. Year over year inventories also decreased, lower by 44.0 million pounds or 8.3% less than November of 2016.
Other Studies
$ per CWT Fundamental Backdrop Choice - Select Boxed Beef Spread January 2004 - Present 300 Choice Select Spread 250 200 150 100 50 0 1/5/2004 1/5/2006 1/5/2008 1/5/2010 1/5/2012 1/5/2014 1/5/2016 100 98 96 94 92 90 88 86 84 82 80 78 76 74 72 70 68 66 64 62 60 58 56 54 52 50 48 46 44 42 40 38 36 34 32 30 28 26 24 22 20 18 16 14 12 10 8 6 4 2 0-2 -4-6 -8 $ per CWT
$/CWT Fundamental Backdrop 35 30 Choice-Select Spread 10-Yr Avg 10-Yr Max 10-Yr Min 2017 2016 25 20 15 10 5 0-5 7-Jan 27-Jan 16-Feb 7-Mar 27-Mar 16-Apr 6-May 26-May 15-Jun 5-Jul 25-Jul 14-Aug 3-Sep 23-Sep 13-Oct 2-Nov 22-Nov 12-Dec
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Summary The USDA s monthly Cattle-On-Feed report revealed December 1 on feed supplies of 11.516 million head, 108.1% of last year s levels, 1.4% greater than average expectations. Placements in November totaled 2.099 million head or 113.9% of last year and well above pre-report expectations of 105.8%. Fed cattle marketed during November were 1.844 million head or 103.2% of 2016, right on expectations. Total beef in cold storage as of November 30 was reported to be 487.0 million pounds, a decrease of 20.1 million pounds or 4.0% less than October and compares to the average 2.1% build from October to November over the past ten years. Year over year inventories were down by 44.0 million pounds or 8.3% less than November of 2016. Beef and Veal exports for October were reported at 260.0 million pounds, an increase of 17.0 million pounds or 7.0% more than September, and were 30.1 million pounds or 13.1% greater than October of 2016. (November Beef & Veal export data will be released on January 8, 2018)
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