Recent reports from the Department of Agriculture show the U.S. cattle inventory is still declining. Micheal Clements shares what that means moving forward.
Thomas Capps: Hello and welcome to Tennessee Home and farm radio – I’m Thomas Capps. Recent reports from the Department of Agriculture show the U.S. cattle inventory is still declining. Micheal Clements has more on what that means for the cattle industry moving forward.
Clements: The July round of cattle-focused reports from USDA shows drought is still impacting the number of cattle available for breeding. Bernt Nelson, American Farm Bureau Federation Economist, says the Cattle Inventory Report showed a larger decline than what analysts expected.
Nelson: In July the report estimated that all cattle and calves in the U.S. totaled 95.9 million head on July 1. This was down three percent compared to last year's report. U.S. beef cattle came in at 29.4 million head. Now this was a 52 year low for beef cattle supplies. That's a significant number when we start talking about beef prices.
Clements: Placements in the Cattle on Feed report remain elevated, a signal that drought is still having an impact on cattle producers.
Nelson: This came in three percent above last year. So, this shows that placements have come up a little bit. This tells us that farmers are still putting cattle on feed. So, while our cow slaughter numbers have come down, right around 12 percent from last year, we are still seeing a relatively high number of heifers being placed on feed. This tells us that we have not yet bottomed out in the cattle cycle.
Clements: Nelson says that when considering demand, consumers should expect prices to rise.
Nelson: As long as we have elevated placements of heifers on feed, this will indicate that contraction of our cattle inventory will continue, for sure through 2024 and it will definitely be through 2025 before we can even consider rebuilding some of this herd. Demand has remained strong on both the global front and the domestic front. But prices have begun to come up, and they may continue to come up as long as our demand stays strong for beef.
Clements: Learn more on the Market Intel page at fb.org. Micheal Clements, Washington.
Thomas Capps: Thanks Micheal. For Tennessee Home and Farm Radio, I'm Thomas Capps. Thanks For listening and have a great day.
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