The number of cattle placed in U.S. feedlots in January rose for the first time in eight months, a government report showed on Friday, a sign that the worst drought in more than half a century continued to impact the industry.
The U.S. Department of Agriculture showed placements up two per cent from a year earlier to 1.876 million head, showing their first monthly increase since May. The average of analysts’ estimates was for a 0.4 per cent gain.
Ranchers have been forced to move cattle into feedlots from drought-damaged pastures.
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USDA put the supply of cattle in feedlots on Feb. 1 at 11.073 million head, or 93.8 per cent of the year-ago, which matched the average trade estimate.
The government said the number of cattle sold to packers, or marketings, in January was up about six per cent from a year earlier at 1.917 million head versus a forecast for a 4.8 per cent increase.
Analysts said the larger-than-expected placements could weigh on deferred live cattle contracts at the Chicago Mercantile Exchange when the market reopens on Monday morning.
They said the higher-than-expected marketings may support nearby cattle contracts.
— Theopolis Waters writes for Reuters from Chicago. Additional reporting for Reuters by Michael Hirtzer.
