CHICAGO, Ill. – The U.S. Department of Agriculture is removing a familiar component of its monthly cattle-on-feed report, a closely watched industry gauge, and emphasizing the total U.S. number, to provide what it feels is a clearer picture of the overall U.S. on-feed segment.
As of Feb. 14, the traditional seven-state report, which many traders had come to rely on, will be gone. By concentrating on the larger U.S. feedlots, the USDA also hopes to work better with the Census of Agriculture, a department analyst said.
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“We’re conducting the Census of Agriculture right now and the question was, do we use eight years of U.S. data or wait five more years to have 13 years (of data) to make the change?” said Steve Anderson, cattle statistician at the National Agricultural Statistics Service.
“This was the time to make the break so the publications match up in terms of having the same years worth of data” for the Census of Agriculture, Anderson said.
The census, taken every five years, gives the most complete periodic profile of U.S. agriculture for Congress and policy-makers as well as for private industry.
The cattle-on-feed report, which measures the number of cattle in feedlots being fattened for slaughter, is a gauge of future beef production that can influence cattle prices, both for the cash and futures markets.
In the past, the USDA had given a breakout of feedlots in seven key states: Texas, Nebraska, Kansas, Iowa, Colorado, California and Arizona.
The shift in reporting, which requires analysts to get used to looking at a bigger picture, was needed for baseline measurements, Anderson said.
The USDA said the shift will occur Feb. 14.
The department will continue publishing an estimated U.S. total on-feed and state-by-state data for the top 12 U.S. states that raise cattle in large feedlots.
“The same seven-state data can still be calculated from the U.S. release by summing the historic seven-state totals,” USDA said last month.
The USDA last changed its cattle-on-feed report in 1996, when it created a monthly report focused on feedlots with a minimum of 1,000 cattle. The industry focused on the seven-state breakout because it had three years of comparison data.
Before 1993, a 13-state quarterly report had covered cattle feedlots. But this caused problems, Anderson said. Some feedlots were small and had cattle on feed for only a few months each year, which skewed comparisons.
NASS started reporting the seven-state monthly numbers in large 1,000-head feedlots to reduce report costs and create a more stable base to survey, Anderson said.
“We used to have all kinds of problems when we had all cattle on feed because of the sampling and the cost and small feedlots jumping in and out. It was a lot more cost-effective to go to just those feedlots with over 1,000 head capacity,” Anderson said.
In 1996, the stastics service also started to estimate a total U.S. cattle number for 1,000-head minimum feedlots.
That number is considered more useful than the seven-state report because the marketings section correlated better with U.S. slaughter data and the U.S. on-feed number could also be compared with the semiannual U.S. cattle inventory report, which estimates all cattle and calves.
“What we are trying to do is just get the report to a U.S. number and then list out the states that are major feeding states,” Anderson said.
Aside from the top seven states, the additional five states making up the 12-state monthly section are New Mexico, Oklahoma, Washington, Idaho and South Dakota.
Anderson said the top seven states accounted for 83.8 to 85.7 percent of all U.S. feedlot cattle since 1996.
Although that percentage has been rising, it was still short of the percentage represented by the overall U.S. number for all 1,000-head minimum feedlots.
The 12 states, by contrast, represent 96 to 97 percent of the total number of cattle on U.S. feedlots, Anderson said.
The other 38 states account for three to four percent, with a monthly survey done in the top five of those states. Those are listed as “other states” in the monthly report: Montana, Wyoming, Illinois, Michigan and Minnesota.
