Tag Archives: cattle

The October cattle on feed report was not all that friendly to a market that has been down this week. Cattle on feed and cattle sent to market in the month of September were at or near analyst expectations. However cattle placed into feed yards in September were well above the average analyst estimate. The large placements are likely a factor of dry conditions seen across much of the country. With limited winter grass and wheat pasture available lots more cattle are coming to town and headed for feedlots.

According to the USDA cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.7 million head on October 1, 2020. The inventory was 4 percent above October 1, 2019. This is the highest October 1 inventory since the series began in 1996.

The inventory included 7.31 million steers and steer calves, up 6 percent from the previous year. This group accounted for 62 percent of the total inventory. Heifers and heifer calves accounted for 4.41 million head, down slightly from 2019.

Placements in feedlots during September totaled 2.23 million head, 6 percent above 2019. Net placements were 2.17 million head. During September, placements of cattle and calves weighing less than 600 pounds were 445,000 head, 600-699 pounds were 360,000 head, 700-799 pounds were 500,000 head, 800-899 pounds were 517,000 head, 900-999 pounds were 300,000 head, and 1,000 pounds and greater were 105,000 head.

Marketings of fed cattle during September totaled 1.85 million head, 6 percent above 2019. Other disappearance totaled 58,000 head during September, 2 percent below 2019.

October Cattle on Feed October 2020 Est. Range of Estimates
On Feed 104.00% 103.30% 102.7%-103.9%
Placed 106.00% 102.50% 98.9%-106.5%
Marketed 106.00% 105.90% 104.9%-106.7%

 

Jerry Stowell, Country Futures, breaks down the report and gives his thoughts on what this means for the cattle market:

 

Full USDA report here:

https://downloads.usda.library.cornell.edu/usda-esmis/files/m326m174z/q811m918x/8c97md838/cofd1020.pdf

  • Cash market weakness coming out of the north
  • Are the cattle to big?
  • What is behind the strength in the soybeans
  • Will soybean prices continue to grow?
  • Why are corn prices going up?
  • Wheat continues to see dryness global
  • Sum it up its weather & China
  • Ethanol report out on Wednesday saw production tick lower
  • Not endorsing one candidate over the other how does Nov 4th play into mkts
  • Election risks
  • Could there be an influx of dairy on the cattle market with current milk prices?

 

  • Continuation of the status quo
  • Many wondering where the stock is in China
  • Will their buying keep up in the short term?
  • Harvest progress is moving along quickly
  • South America forecast is getting better
  • Black Sea region is still tough
  • Basis in the country
  • Is the down trend in the cattle going to turn around?
  • How is cash holding up?
  • COF on Friday

 

  • Wheat is the most confusing market right now
  • Light buyer support for soybeans
  • Dry weather concerns
  • Corn isn’t really expensive…yet beans have some good value
  • Cattle had some struggles in the trade, falling off the cliff today
  • Make sure you remember what kind of year this is-does that set the stage for 2021
  • Does the downtrend in cattle set the tone for cash this week?

 

  • Fundamental news is bullish
  • Funds position on the December cattle-risk off attitude
  • Election still has a “hold” on the markets
  • Why are cash bids so low?
  • Is the stock market worried about the election?
  • Seeing a decline in the grade…does that mean we are getting current?
  • How are weights?
  • Fund liquidation vs. good fundamentals
  • Hogs…continue to have export news to China
  • Tech picture on the hogs looks good
  • Hogs vs. cattle in the trade
  • Oct hogs go off the board tomorrow
  • Farmers selling beans…did it happen to soon?
  • Grain summary is China.
  • Harvest clips along

 

OMAHA, Neb., (GLOBE NEWSWIRE) — Green Plains Inc. (NASDAQ:GPRE) today announced the sale of its remaining 50% joint venture interest in Green Plains Cattle Company LLC to a group of investment funds that include AGR Partners and StepStone Group, among others, for approximately $80 million, plus closing adjustments. The transaction was signed on October 9, 2020 with an effective date of October 1, 2020.

“With the sale of our remaining ownership in Green Plains Cattle Company, combined with our recent quarterly distribution and earnings bonus from performance of the cattle business, we have added approximately $96 million of liquidity to our balance sheet. This sale allows us to redeploy capital to support our long-term objective of building a technology focused biorefining platform, producing sustainable, high-value, high-protein ingredients the market needs,” said Todd Becker, president and chief executive officer.

Green Plains entered the cattle feeding industry in June 2014, with the purchase of Supreme Cattle Feeders, a 70,000-head feedyard in Kismet, Kan. Over the past six years, Green Plains Cattle Company grew to become the fourth largest cattle feeder in the United States with a total capacity of more than 355,000 head of cattle across six feedlots in Colorado, Kansas and Texas.

“This transaction further streamlines our business to focus on the transformation to a world-class provider of high value ingredients, which includes the deployment of high protein technology as a natural line extension to our platform. The proceeds from the sale and distribution, coupled with our previously announced tax refund and $75 million in protein financing, will add nearly $225 million of liquidity to Green Plains, or over half the remaining amount needed to fund the build-out of high protein technology,” added Becker.

As part of the transaction, Todd Becker will remain on the board of directors of Green Plains Cattle Company for the next year to assist in the transition.

The Innovation Center for U.S. Dairy Monday unveiled the Net Zero Initiative. The industry-wide effort will help U.S. dairy farms of all sizes and geographies implement new technologies and adopt economically viable practices.

The initiative is a critical component of U.S. dairy’s environmental stewardship goals. The plan is endorsed by dairy industry leaders and farmers to achieve carbon neutrality, optimized water usage and improved water quality by 2050. The organization also announced a key milestone on its journey toward carbon neutrality, an up to $10 million commitment and multi-year partnership with Nestlé to support the initiative and scale access to environmental practices and resources on U.S. farms.

The goals include becoming carbon neutral or better, optimize water use while maximizing recycling, and improve water quality by optimizing utilization of manure and nutrients. Officials say dairy companies and farms are already contributing to the goals in individual ways, and the dairy community will continue those efforts through the U.S. Dairy Stewardship Commitment.

  • Wheat up big again
  • All the grains up again
  • How can we interrupt negative numbers on the deferred contracts?
  • All of this related to weather globally
  • We are looking at potential serious weather issues
  • China, even on holiday, jumped into the markets to make purchases
  • Does China panic in weather markets both here & in South America
  • Feeder cattle continue to struggle

  • Key technical points on the corn & soybeans
  • Who will be the next big bean buyer?
  • Funds are they going to be long?
  • WASDE on Friday…how does that effect livestock?
  • Feeder cattle index has had a history of putting in a top in the beginning of October
  • What should we do with the calves? Do we hold & wait?
  • Cattle have been stuck in a range-does that make a boring trade?
  • Boxed beef is the low being put in?
  • COVID cases picking up does that make livestock nervous?