Economic Tidbits

Cow Herd Wanes

The USDA National Agricultural Statistics mid-year beef cow inventory indicates the nation’s beef cow herd continues to wane. The inventory, 29.4 million head, is down 2.6 percent from a year ago. Derrell Peel, livestock economist with Oklahoma State University, writes that this is the fifth consecutive year of smaller mid-year beef cow inventories, with the herd down 3 million head or 9.3 percent compared to 2018. Replacement heifers, at 4.05 million head, are also down 2.4 percent from a year ago (Figure 3). And the U.S. calf crop this year, 33.8 million head, is estimated to be 1.9 percent less compared to last year.  


Source: Livestock Marketing Information Center based on USDA data; 2013 data not reported

The July count does not include state-specific numbers. In January, Nebraska’s herd totaled 1.703 million cows, off 5 percent from the previous January and down almost 11 percent since 2019. Nebraska’s calf crop last year totaled 1.640 million head, off 2 percent from 2021. A drop of 5 percent this year would mean a crop of 1.56 million head, the smallest in at least 33 years.

The ongoing herd liquidation is not surprising given the lingering drought and higher feed costs. And there are no signs of a turnaround. Peel says the current U.S. inventory of beef replacement heifers is less than the previous cycle lows in 2011 and 2012 and the lowest in 50 years of data. Feeder cattle prices are already nearing record highs. A further tightening of the cattle supply should mean even higher prices which will create the opportunity for positive returns for the state’s cow/calf operations and the incentive to rebuild herds. But a rebuilding of the herd will also require a loosening of drought’s grip in the state’s ranch country.

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