The U.S. Department of Agriculture Jan. 1, 2001 cattle inventory report showed signs of expansion but growth was not seen as expected.

All cattle and calves in the United States as of Jan. 1, 2001, totaled 97.3 million head, 1 percent below the 98.2 million head on Jan. 1, 2000 and 2 percent below the 99.1 million two years ago.

Analysts believed production female inventory would increase but the Cattle report puts all cows and heifers that have calved at 42.6 million, which is slightly below the 42.8 million on Jan. 1, 2000 and 1 percent below the 42.9 million two years ago. Analyst expected total cow numbers to be down but for the beef cow inventory to be up. They thought that 2000 would see the cycle lows in beef cow numbers.

As we break total cow numbers down further, however, beef cow totals, at 33.4 million cows, were down 1 percent from both 2000 and 1999. That means that the expected up turn from herd reduction to cow herd expansion has not happened yet. Meanwhile, dairy cows actually increased slightly despite a year of lower milk prices.
The 2000 calf crop was estimated at 38.6 million head. Despite a smaller cowherd the calf crop was down only slightly from 1999 and 1998. That’s due in part to a mild winter in 2000, which resulted in less calf death loss.

Replacement heifers
Profits trigger the expansion phase when producers start retaining heifers for breeding. But until now, heifer retention had been slowed by the drought in much of cattle country last summer. As we look toward spring 2001, profits of $100 to $200 are not something that can be ignored for long. Producers have kept back 5.59 million head of replacement heifers according to the cattle report. That’s a 2 percent increase over heifer replacement totals in January 2000. A new statistic included in the Jan. 1, 2001 cattle report is the number of beef replacement heifers that are expected to calve. The inaugural guess is 3.14 million head out of the 5.59 million replacement heifers held back would actually calve during 2001.

As 2001 unfolds, feedyard placement and slaughter data will show that producers are holding more heifers for breeding. And as they hold back more heifers the supply of calves available for feeders will tighten, further increasing prices for stocker and feeder calves. Calf prices are expected to average $5 per hundredweight higher than in 2000. Profitability for cow-calf producers means the average value of the production females will continue to climb. Average prices for bred cows and cow-calf pairs are expected to linger between $800 to $900 at auction this year. The peak in bred cow prices, however, is not expected until 2003.