Cattle Futures Drop after Bearish USDA Reports

October and December live cattle contracts finished the day limit down to close at 114.400 and 115.175 respectively.  Feeder cattle followed the downward trend with all 2017 contracts down at least 4 on the day.  This comes after Friday’s cattle on feed report that showed June feedlot placement 16 percent above 2016.  Inventory was reported at 9.69 million steers and steer calves up 1 percent from 2016, while fat heifers and heifer calves totaled 3.86 million head, up 11 percent from last year.   It appears however that herd expansion may be slowing down with replacement heifer retention estimated at the lowest level seen in recent recorded years.  Herd expansion will continue in 2017 but it appears that trend may end in 2018 according to analysts.