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Drought moves more cattle to feedlots

03/22/2012 @ 8:28am

The U.S. Department of Agriculture is expected to report a year-over-year rise in the number of cattle sent to U.S. feedlots in February compared with a year ago as the lingering drought in the Southern plains and Mexico continues to force cattle off dried pastures.

The USDA will release the data in its monthly cattle-on-feed report, due out Friday at 3 p.m. EDT (1900 GMT).

A majority of brokers and analysts expect the federal data to show an acceleration in the number of placements, or young cattle sold to feedlots for fattening. The USDA is expected to report 1.71 million head of young cattle, known as feeders, were placed last month, according to the average prediction of 11 analysts and traders in a Dow Jones Newswires survey. If the average is correct, the number of cattle added last month would be 2.7% above the same month a year ago.

Cattle producers in the southern Great Plains spent much of 2011 shrinking their herds as a devastating drought left them with limited land on which to graze animals. Placements, as a result, surged during the balance of last year as owners rushed to sell animals--in many cases, well ahead of schedule. A similar pattern could continue to unfold this year, especially if significant moisture fails to reach portions of southern plains and far west.

Analysts expect cattle from Mexico, where drought continues to ravage ranching populations, to account for some of the fresh placements as cattlemen south of the border push animals northward.

In the Dow Jones survey, analysts pegged the number of cattle exiting feedlots for slaughter, known as marketings, at 1.78 million head for February, or 0.5% below the same month a year ago and 6.1% above the five-year average. Slowing meat production this year at slaughterhouses, who've been trying to limit their costs for expensive cattle, is expected to lead to the year-over-year drop in marketings.

Analysts on average estimated there were a total of 11.85 million head of cattle in U.S. feedlots on March. 1, which would be 2.3% above the level from a year ago and 1.4% above the five-year average.


-By Marshall Eckblad, Dow Jones Newswires; 312-750-4070; Marshall.Eckblad@dowjones.com
(END) Dow Jones Newswires
March 21, 2012 18:24 ET (22:24 GMT)
DJ CATTLE-ON-FEED SURVEY: Drought Seen Sending More Cattle To Feedlots->copyright

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