- The January Cattle on Feed report was bullish for cattle prices as January 1 inventories and December placements were lower than expected. Total January 1 feedlot supplies were 5.6% lower than the previous year. - December placements were 1.664 million head, slightly lower than the previous year but lower than analysts expected, which was a bullish surprise. - Lower placements over the past 10 months means cattle supplies in feedlots are becoming more front-loaded, with fewer cattle expected to come to market in the near future. Beef supplies are expected to remain limited going forward.

1. Sponsored by
Vol. 11, No. 19 / January 28, 2013
Our initial read on Friday’s January Cattle on Feed re- USDA Cattle on Feed Report -- January 2013
port is bullish since December placements were significantly Thous. Hd. 2012 as Pct. of 2011
lower and January 1 inventories were lower than pre-report sur- Esti- Differ-
veys indicated. The key national data from the report appear in the 2011 2012 Actual
mate* ence
table at left as well as the average percentage-of-last-year figures On Feed, January 1 11,861 11,193 94.4 95.6 -1.2
form DowJones pre-report survey. Some key numbers and takea- Placed on Feed in December 1,673 1,664 99.5 104.1 -4.6
ways are: Fed Cattle Marketed, December 1,776 1,745 98.3 93.2 5.1
• Total on-feed supplies as of January 1, 2013 were 11.193 million *Dow Jones survey
head, 5.6% lower than year ago levels. Prior to the report ana-
lysts were expecting total feedlot supplies to be down on 4.4%
FEEDLOT PLACEMENTS
Total U.S., Lots of >1000 Head Capacity
from year ago levels.
Thous. Hd.
• December placements numbeed 1.664 million head, a figure 2700
slightly smaller than one year ago. But recall from Thursday’s 2011
Daily Livestock Report that only one of the ten respondents to 2500
2012
DowJones’ survey thought that this number would be lower than
Avg. '06-'10
during December 2011 so the negative year-on-year number is a 2300
surprise. The 4.6% difference between the “expected” and actual
year-on-year change is, we think, significant and will likely be 2100
bullish for summer Live Cattle futures.
1900
• December marks the 10th month in 2012 in which placements
have been smaller than one year earlier. 1700
• Continued high feed costs and extremely high breakevens re-
main the primary impediment to placing more cattle on feed. 1500
Most observers felt that limited grazing capacities and poor win-
ter wheat conditions would drive cattle into feedlots. But that 1300
J F M A M J J A S O N D
appears to have been trumped by high feed costs that are driving
a trend for cattle to spend more time outside of feedlots. As that
happens, the age of cattle coming to market will be higher. They COF AVERAGE PLACEMENT WEIGHT
will still almost all be under 30 months but older cattle in means Lbs.
heavier cattle in and heavier cattle out. Hard to see how they 730
could get much bigger but we think it is likely.
• Another month of lower placements means that the supply of 720
cattle in feedlots continues to get more front-loaded. Our calcula-
710
tions indicate that, as of January 1, there were roughly
3.706million cattle (these figures do not allow for death losses)
700
that have been on feed for 120 days or more. That number is
4.4% higher than one year ago. On the other hand, there were
690
only 1.940 million cattle in feedlots on January 1 (down 19% from 2011
last year) that had been there 90 to 120 days and 5.547 million 2012
680
that had been placed in the past 90 days — 6.7% fewer than one Avg. '06-'10
year ago. While slaughter may run ahead of last year into early
670
March, significantly lower numbers are coming.
The key take-away from the report is that beef supplies
660
will be limited going forward and the latest survey supports our F M A M J J A S O N D
forecast for total cattle slaughter in first half of 2013 to be down
4.4% from year ago levels. The key wildcard will be cow slaugh- ing into 2014. That would pull heifers out of the slaughter supply and
ter. We think the lack of forage will prevent producers from significant tighten beef supplies even more. If rains don’t come in time for spring
herd rebuilding in the short term. If rain comes to key cow-calf areas, green-up, many producers will be in dire straits for roughage and
we could see significant herd building beginning this spring and last- more cows could move to slaughter, increasing 2013 supplies.
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The Daily Livestock Report is published by Steve Meyer & Len Steiner, Inc., Adel, IA and Merrimack, NH. To subscribe, support or unsubscribe visit www.dailylivestockreport.com. Copyright © 2013
Steve Meyer and Len Steiner, Inc. All rights reserved.
The Daily Livestock Report is not owned, controlled, endorsed or sold by CME Group Inc. or its affiliates and CME Group Inc. and its affiliates disclaim any and all responsibility for the informa on
contained herein. CME Group®, CME® and the Globe logo are trademarks of Chicago Mercan le Exchange, Inc.
Disclaimer: The Daily Livestock Report is intended solely for informa on purposes and is not to be construed, under any circumstances, by implica on or otherwise, as an offer to sell or a solicita-
on to buy or trade any commodi es or securi es whatsoever. Informa on is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or
possible where projec ons of future condi ons are a empted. Futures trading is not suitable for all investors, and involves the risk of loss. Past results are no indica on of future performance.
Futures are a leveraged investment, and because only a percentage of a contract’s value is require to trade, it is possible to lose more than the amount of money ini ally deposited for a futures
posi on. Therefore, traders should only use funds that they can afford to lose without affec ng their lifestyle. And only a por on of those funds should be devoted to any one trade because a
trader cannot expect to profit on every trade.

2. Sponsored by
Vol. 11, No. 19 / January 28, 2013
PRODUCTION AND PRICE SUMMARY Week Ending 1/26/2013
Current Pct. Pct. Pct.
Item Units Week Last Week Change Last Year Change YTD Change
Total Meat & Poultry Prod. Million lbs. 1693.5 1763.1 -3.95% 1631.1 3.83% 40,431 -1.22%
C FI Slaughter Thou. Head 625 615 1.63% 601 3.99% 437 -22.10%
A FI Cow Slaughter Thou. Head 141.1 101.7 38.75% 141.2 -0.11% 243 -8.01%
T Avg. Live Weight Lbs. 1333 1336 -0.22% 1306 2.07% 1,333 2.28%
T Avg. Dressed Weight Lbs. 802 803 -0.12% 786 2.04% 802 2.46%
L Beef Production Million Lbs. 500.1 492.9 1.46% 471.1 6.16% 348 -20.26%
E Live Fed Steer $/cwt live wt. 122.53 123.93 -1.10% 123.82 -1.04%
Dressed Steer $/cwt carcass 197.93 197.19 0.38% 199.41 -0.74%
& OKC Feeder Steer 600-700 Lbs. 145.09 148.14 -2.06% 151.48 -4.22%
Beef Cutout 600-750 Choice 188.95 192.68 -1.94% 184.26 2.55%
B Hide/Offal $/cwt live wt. 13.59 13.53 0.44% 12.37 9.86%
E Rib Choice 273.17 270.37 1.04% 252.02 8.39%
E Round Choice 167.13 173.31 -3.57% 168.77 -0.97%
F Chuck Choice 163.49 165.39 -1.15% 159.64 2.41%
Trimmings, 50% Fresh 66.08 71.91 -8.11% 98.80 -33.12%
Trimmings, 90% Fresh 211.74 211.31 0.20% 205.51 3.03%
H FI Slaughter Thou. Head 2159 2222 -2.84% 2154 0.25% 1,618 -21.61%
O FI Sow Slaughter Thou. Head 56.4 46.6 21.21% 59.5 -5.14% 103 -7.45%
G Avg. Dressed Weight Lbs. 208 207 0.48% 208 0.00% 208 -0.60%
S Pork Production Million Lbs. 448 459.8 -2.57% 447.7 0.07% 334 -22.72%
Iowa-S. Minn. Direct Avg. 86.79 85.27 1.78% 86.86 -0.08%
& Natl. Base Carcass Price Weighted Avg. 84.82 83.26 1.87% 84.42 0.47%
Natl. Net Carcass Price Weighted Avg. 87.31 85.69 1.89% 86.91 0.46%
P Pork Cutout 200 Lbs 84.94 83.79 1.37% 84.14 0.95%
O Hams Primal Cutout 67.48 65.70 2.71% 63.19 6.79%
R Loins Primal Cutout 88.04 88.62 -0.65% 94.37 -6.71%
K Trimmings, 72% Lean Fresh 67.00 62.29 7.56% 63.33 5.80%
Bellies Primal Cutout 140.01 137.52 1.81% 117.97 18.68%
C Young Chicken Slaughter* Million Head 151.09 158.86 -4.89% 147.10 2.71% 7,875 -2.61%
H Avg. Weight Lbs., RTC 4.23 4.42 -4.22% 4.11 2.90% 4.3 3.38%
I Broiler Production Million Lbs., RTC 639.4 701.8 -8.90% 604.9 5.69% 34,162 -1.22%
C Eggs Set Million 195.9 196.6 -0.38% 193.9 1.02% 589 1.56%
K Chicks Placed Million Head 162.2 163.9 -1.04% 160.5 1.06% 490 0.97%
E 12-City Broiler Composite 98.08 101.23 -3.10% 81.21 20.80%
N Georgia Dock Broiler 2.5-3 Lbs. 99.52 99.21 0.30% 89.93 10.70%
Northeast Breast Skinlss/Bonelss 137.27 137.15 0.10% 130.76 5.00%
Northeast Leg Quarters 68.03 66.97 -1.50% 74.64 -10.40%
T Young Turkey Slaughter* Million Head 4.20 4.31 -2.53% 4.18 0.38% 230.4 -0.20%
U Avg. Weight Lbs. 25.26 25.22 0.16% 25.66 -1.59% 25.5 0.04%
R Turkey Production Million Lbs. 106.0 108.6 -2.38% 107.3 -1.21% 5,586 2.06%
K Eastern Region Hen 8-16 Lbs. 95.50 98.00 -2.60% 98.73 -3.30%
F Corn, Omaha $ per Bushel 7.46 7.48 -0.33% 6.43 16.03%
E DDGS, Minnesota $ per ton 252.50 248.00 1.81% 180.50 39.89%
E Wheat, Kansas City $ per Bushel 7.92 8.06 -1.74% 6.75 17.33%
D Soybeans, S. Iowa $ per Bushel 14.70 14.69 0.07% 12.25 20.00%
SB Meal, 48% Central Illinois $ per Ton 431.70 431.00 0.16% 322.10 34.00%
* Chicken & turkey slaughter, production and prices are 1 week earlier than the date at the top of this table. Cow & sow slaughter are for 2 weeks earlier
The Daily Livestock Report is published by Steve Meyer & Len Steiner, Inc., Adel, IA and Merrimack, NH. To subscribe, support or unsubscribe visit www.dailylivestockreport.com. Copyright © 2013
Steve Meyer and Len Steiner, Inc. All rights reserved.
The Daily Livestock Report is not owned, controlled, endorsed or sold by CME Group Inc. or its affiliates and CME Group Inc. and its affiliates disclaim any and all responsibility for the informa on
contained herein. CME Group®, CME® and the Globe logo are trademarks of Chicago Mercan le Exchange, Inc.
Disclaimer: The Daily Livestock Report is intended solely for informa on purposes and is not to be construed, under any circumstances, by implica on or otherwise, as an offer to sell or a solicita-
on to buy or trade any commodi es or securi es whatsoever. Informa on is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or
possible where projec ons of future condi ons are a empted. Futures trading is not suitable for all investors, and involves the risk of loss. Past results are no indica on of future performance.
Futures are a leveraged investment, and because only a percentage of a contract’s value is require to trade, it is possible to lose more than the amount of money ini ally deposited for a futures
posi on. Therefore, traders should only use funds that they can afford to lose without affec ng their lifestyle. And only a por on of those funds should be devoted to any one trade because a
trader cannot expect to profit on every trade.