Beef Herd Continues to Contract, Bullish for 2010

January 28, 2010 06:00 PM

By Kim Watson Potts

The latest USDA cattle inventory report shows that the nation's cattle herd is down 1%. This makes the smallest herd inventory since 1963, according to CattleFax.

Beef demand has been the biggest drain on the beef market these last two years, and has kept cattle supplies low. That lower beef demand has translated into $140/head decline between 2008 and 2009, said Randy Blach during the CattleFax Outlook seminar at the Cattle Industry Convention on Friday.

"Demand remains the biggest challenge for the beef industry 2010. Though the supply situation is very bullish, demand must stabilize in order for prices to turn significantly higher," said Blach.

While demand isn't expected to improve quickly in the coming year, CattleFax still predicts improvement in prices for all segments of the cattle industry compared to 2009. CattleFax analysts project:

  • Fed steer prices will hit $86 to $88 in 2010 compared to $83.50 in 2009.
  • 750 lb. feeder steers will move up to $99 to $101 compared to $95.50 in 2009
  • 550 lb. steer calves will reach $111 to $113 compared to $107 in 2009.
  • Utility slaughter cows prices will reach $53 to $54 from $47 in 2009.

You can read more from CattleFax's Outlook seminar and other news from the Cattlemen's Industry Convention by following this link to Beef Today's coverage.

CattleFax provides market analysis and forecasting tools for subscribing members. You can find out more at

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