U.S. cattle inventory still declining

 Resize text         Printer-friendly version of this article Printer-friendly version of this article

Editor’s note: USDA’s annual July cattle inventory report was cancelled due to the government sequester. Doane Advisory Services provides the following estimates.

The U.S. cattle herd remains in the contraction phase of the long-term cycle. The cattle cycle normally lasts about 10 years from trough to trough. The most recent cycle low in the cattle inventory was 2004 so a new cycle low is due within the next year or two. The expansion phase of the cycle, peaking in January 2007, was cut short by rising grain prices and severe drought conditions, particularly in the central and southern Plains. High calf and feeder cattle values were expected to result in a shortened cycle in the cattle inventory, encouraging producers to expand the cow herd. However, drought and continued high feed costs forced further liquidation instead. The liquidation continues even now with cow slaughter rates still relatively high.

As of Jan. 1, 2013, the U.S. cattle herd totaled 89.3 million head, down 1.5 million head or 1.6 percent from a year ago.

We estimate the July 1 cattle inventory at 96.5 million head, down 1.3 percent from a year ago, marking the seventh year of herd contraction. The total inventory as of July 1 is estimated to be down 8.3 million head or 7.9 percent from July 1, 2006, the most recent peak. The beef cow herd as of July 1 is estimated at 29.6 million head, down 2.9 percent from a year ago. Increased Canadian cow imports, particularly dairy cows, have contributed to higher U.S. cow slaughter. However, an uptick in beef cow slaughter during the past two months suggests that drought and lack of forage have prompted further herd liquidation in the United States.

The outlook for feeder cattle prices is higher, and we expect that cow-calf producers in areas with adequate forage are holding on to cows and retaining heifers to place in the cow herd.

The 2012 calf crop totaled 34.279 million head, down over 1 million head from 2011. The calf crop has declined every year since 1995, falling to the lowest level since 1949. With a smaller cow herd, the 2013 calf crop is forecast to decline 479,000 head or 1.4 percent from 2012 to 33.8 million head. The smaller calf crop and increased heifer retention point to tightening feeder cattle supplies through 2014. According to Doane’s forecast, the total U.S. inventory of cattle and calves bottoms in 2014 and then increases gradually. Feeding losses peaked late last summer along with grain prices, but margins have continued to run deep in the red, averaging $170 per head through the first half of this year. With lower corn prices expected later this year and strength in cattle prices, feeding margins are expected to turn positive by the fourth quarter 2013 and through the first half of 2014.



Comments (4) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Susan carter    
Santa fe  |  August, 16, 2013 at 08:24 PM

Yes, hopefully they will decline moe. Blm is destroying the Wild Horse herds.I will never buy beef again for my family. With the advent of horse slaughter in the US many more people will stop eating beef for fear of co-mingled horse eat in beef products. Never again !

Susan carter    
Santa fe  |  August, 16, 2013 at 08:24 PM

Yes, hopefully they will decline moe. Blm is destroying the Wild Horse herds.I will never buy beef again for my family. With the advent of horse slaughter in the US many more people will stop eating beef for fear of co-mingled horse eat in beef products. Never again !

Susan carter    
USA  |  August, 16, 2013 at 08:31 PM

BLM is destroying our US Wild horse herds. The beef industry supports this madness. I will never buy beef for my family again. With the advent of horse slaughter for human consumption, many more people will stop eating beef for fear of it being horse eat. Cattlemen are digging their own grave !

Michael Connor    
Vermont  |  August, 20, 2013 at 04:15 PM

"our US Wild horse herds" Susan, "Wild" horses are introduced non-native feral animals. They are similar to feral pigs in this regard. Cattle that become feral should be managed as well.


Triangle®

Triangle® vaccines give you the protection you’ve come to know and trust. Available in several combinations, the TRIANGLE killed viral ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Leads to Insight