Has COVID-19 Impacted Price-Weight Relationships and Value of Gain?

In the beginning of COVID-19, much of the attention was focused on managing the redirection of meat product from food service to retail stores. This past month has keenly focused on packing plant closures due to COVID-19 cases among workers and how to manage the supply of fat cattle already ready for slaughter. Fat cattle available for slaughter either cannot get bids or bids are significantly below breakeven prices leaving feedlots with decisions to be made about marketing and placements. The April 2020 Cattle on Feed report (https://usda.library.cornell.edu/concern/publications/m326m174z) revealed March placement decisions. Placements were down about 10% from February 2020 and 25% from March 2019. This was partially due to depressed nearby and deferred future bids, although the nearby bids appear to be discounted greater, suggesting that the market — at least right now — believes demand for product will recover in the second half of the year. Marketings as a response to plant closures will come in the June 2020 Cattle on Feed report.