Cattle Herds Increase; Shift to the Plains and Midwest

Cattle Herds Increase; Shift to the Plains and Midwest

As the nation’s cowherd enters into an expansion, several key factors are at play, says Darrell Peel, ag economist, Oklahoma State University at the 2015 NCBA Cattlemen’s College. As cattlemen respond to historic high prices and environmental concerns, expansion will be slow and variable.

Cow Herd and Heifer Retention

“Herd inventory numbers weren’t unexpected,” Peel said. Everything that prevented cow numbers from increasing the past few years was external—drought, feed and other input costs, etc.  “Cattlemen were ready to go when drought let them. We probably have the youngest cow herd ever,” Peel said.

Approximately 19% of beef cows are replacement heifers. Producer have been aggressively retaining heifers for several years in a row, and heavily culling cows for the past six years. “But not every heifer will make the team,” Peel said.

Since heifers have a two-year development before they are counted in true production of having a calf, Peel looked further. Of the nation’s herd, 85% of heifers that are bred or “expected to calve” actually enter the herd.

“Cows don’t have litters,” Peel added. “It’s a slow process to expand the cow herd.”

Peel estimates the U.S. needs about 32 million cows to fill the demand. Pulling out those heifers, meanwhile, will also continue to pressure feeder supplies.

Stockers and Feeders Moving to the Plains & Midwest

Backgrounding and feeding capacity is moving to the central portion of the country, heifer retention will reduce slaughter supplies. “Feeder supply is more than a year ago, but still a really small number. We have a very tight feeder supply and will continue to do so.” From 2003-2004, heifer retention dramatically reduced total beef production numbers—not due to BSE discovery, but from  increased heifer retention and cow herd expansion.

To get a rough estimate of stocker cattle movements, using the winter stockers reported in the January inventory report, Peel takes estimated feeder supply for the country and individual states, dividing by the state/national calf crop number from the year below, to estimate how many cattle are still in the state on Jan. 1. “It’s not a perfect measure, but our system doesn’t really measure stocker cattle well,” he said.

Texas (7%), Oklahoma (6%), Kansas (6%) and Missouri (5%) led the states in greatest stocker expansion during 2014. “We don’t need a PhD to hear what the market is telling us—we are too small. While we are at a high price level already, we have a ways to go from a correction in beef production,” Peel told cattlemen. “Prices in 2015 will average higher than 2014—up to late 2016 and 2017 when we finally see higher feeder supplies come to the yard.”





Back to news




Spell Check

No comments have been posted to this News Article