July 4, 2006

US cattle-on-feed falls in May but overall production rising                                

Placements of cattle on feed in May declined 15.5 percent on-year and were 19 percent smaller than the five-year average. 

The decline in placements during May pulled total placements during the last four months down 3.3 percent on-year ago levels.

Overall, the report suggests that fed cattle marketings in late summer and early fall would not be as large as previously expected. 

Still, recent cattle slaughter and beef production levels have been above a year ago. 

Over the last four weeks, federally inspected cattle slaughter averaged nearly 8 percent higher than last year and beef production over the same period averaged nearly 9 percent above 2005's. 

Cattle slaughter would likely remain above year ago levels for the foreseeable future.  Year-to-year increases in cattle slaughter are expected to moderate this summer, but could still average 3 to 4 percent above 2005's. 

Dressed cattle weights are moderating, but would still be slightly heavier than last year. 

Beef production this summer and fall is expected to be 4 to 5 percent above last year's level.