Kansas

A Kansas State University economist said returns in the cattle feeding business have plummeted since late summer, and early 2002 doesn't look much better.

"Losses to Kansas cattle feeders in early December likely averaged $130 to $150 per head, and feeders will continue to suffer severe losses through early 2002 unless prices recover more than current futures-based price forecasts suggest," said Rodney Jones, livestock production economist with K-State Research and Extension.

Chicago Mercantile Exchange February live cattle futures settled just over 70 cents per pound [or $70 per hundredweight] on Jan. 2.

April live cattle finished at 73 cents a pound and June closed slightly under 70 cents.

"Current average break-even prices are around $76.50 per cwt, and will remain high for the next several months based on average feeder cattle purchase prices late last summer," Jones said.

The losses are taking a toll on the cattle feeding business. As of Dec. 1, the number of cattle in large feedlots totaled 11.9 million head, down slightly from a year earlier, according to the U.S. Department of Agriculture. And the number of new cattle placed on feed in those feedlots fell 5% to 1.9 million head.

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