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Corn prices, severe weather key to cattle-on-feed numbers

Agriculture.com Staff 01/26/2007 @ 7:34am

High corn prices are expected to weigh on the numbers when USDA releases its monthly Cattle on Feed report this afternoon.

Likely the most notable figure in today's report, according Allendale Inc. livestock specialist Adam Frick, will be placements. In this sector, expect numbers to continue the trend of the last few months.

"I think probably the biggest thing a lot of people will look at will be placements. With the high corn prices, placements will be key," Frick said Friday morning. "How many cattle were placed with $3.50 corn in the Midwest? We're expecting lower placements for the fourth consecutive month. It ties closely to how long the corn prices have been going up."

Frick said he expects placements to be around 91%, while he says fed cattle marketings should be "much lower." Allendale has marketings pegged at 94.4% going into this afternoon's report.

"This marketings number is kind of concerning. Maybe the placements number will offset this, but we're definitely not marketing enough cattle," Frick said.

Much of the dip in the number of fed cattle marketed in the last month has to do with the severe winter weather that's hit much of the Plains in the past few weeks. Though it appears in the short term that the severe winter precipitation is over for the time-being, Frick said the weather will continue to affect marketing numbers.

"I think for the next two to three weeks, you're going to see some effects lingering -- no major ups or major downs," he said. "It's going to cause these feedyard guys who have 1,100-pound steers who maybe lost 50 pounds because of the snow and ice to just unload them at whatever price they can. It's tough to get them back up to that weight and get rid of them.

"That will keep a lid on the market for the next two to three weeks, unless something big happens."

High corn prices are expected to weigh on the numbers when USDA releases its monthly Cattle on Feed report this afternoon.

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