Fed cattle weights and beef supplies

Josh Maples, Mississippi State University

Fed cattle weights have trended higher over the past two months. The average steer dressed weight during March 2024 was 923 pounds. This was the highest March average on record, surpassing the March 2022 total of 914 pounds, and was only the second time that average steer weights during March topped 900 pounds. Cattle weights have been increasing over time, but this particular increase is interesting because of the time of year in which it is occurring. As shown on the chart above, carcass weights typically decrease seasonally during the first half of the year. Carcasses have been getting larger at a time of year when they would normally be decreasing.

Cattle weights are increasing because cattle are spending longer periods in feedlots. As Kenny discussed last week , marketings (or the number of cattle sold out of feedlots) have been lower than expected the past few months. While feedlot supplies are above year-ago levels now, there will be fewer feeder cattle to replace those supplies in 2024. Many feedlots may be incentivized to push weights higher in an effort to keep inventories near capacity for as long as possible. We also have not seen the usual rally in boxed beef or live cattle prices that would normally be expected this time of year and could incentivize more aggressive marketings. Rather, boxed beef prices and live cattle prices trended lower over most of the past month until ticking upward last week.

The larger weights are impacting beef production estimates for 2024. USDA releases forecasts for beef production each month and have been revising their forecasts higher in recent months as the feedlot supply picture becomes clearer. In October 2023, USDA forecasted that 2024 beef production would be 6.3 percent below 2023. In January 2024, the USDA forecast was that 2024 beef production would be 3.2 percent below 2023. In the April 2024 estimate, the forecast was that 2024 beef production will only be 1.9 percent below 2023. Thus, the previous expectation of very tight beef supplies in 2024 has been softened.

Heavier weights are not the only contributor to the revised forecasts. Larger placement totals in some months reflected more cattle coming to feedlots that might have been expected. In a broader sense, this is likely an indicator that herd expansion did not begin as soon some expected. Compared to some expectations, producers continued to send more heifers to feedlots than rather than holding them back for replacements. This contributed to larger feeder cattle supplies and larger beef production expectations for 2024 than would have occurred if those heifers were held back for breeding purposes. It sounds counterintuitive, but beef supplies will get really tight whenever herd expansion begins in full force – because there will be fewer heifers and cows contributing to the beef totals.

The Markets

Prices for feeder cattle and calves were both stronger last week. Futures prices increased, too. The boxed beef cutout had its first weekly increase since March 22nd.

Pasture Conditions