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Beef herd expansion more aggressive than anticipated

USDA's Jan. 1 cattle inventory report brought several surprises to industry watchers, revealing signs of faster-than-anticipated beef herd expansion.
Carol Ryan Dumas

Capital Press

Published on February 4, 2015 8:47AM


The Jan. 1 U.S. cattle inventory report surprised most industry analysts, with a higher-than-expected overall number as well as elevated beef cow and heifer replacement numbers compared with pre-report estimates.

The total beef and dairy cattle and calf count was 89.8 million, up 1.3 million head and more than 1 percent from Jan.1, 2014.

Cattle numbers showed a pretty significant uptick, considering they’ve been in decline the last several years, said Jessica Sampson, ag economist with Livestock Marketing Information Center.

“Overall, the numbers are higher than expected on the beef side in general, she said.

Beef cows, at 29.7 million, were up 608,000 head and 2 percent from year-earlier levels. Beef replacement heifers, at nearly 5.8 million, were up 226,000 and 4 percent. Of those, nearly 34 million are expected to calve this year, up 7 percent from the previous year.

The numbers of beef cows and replacement heifers are definitely higher than what people were expecting, with a 4 percent increase in beef cows coming as one of the biggest surprises, Sampson said.

A lot of moving parts attributed to lower expectations, including high cattle prices that compete with retention, an aging rancher population, the high price of beef replacement heifers, land prices, and the ability of young producers to get into the business, she said.

On the flip side, high cattle prices, tight supplies, good beef demand, affordable feed, and improving pasture conditions in many areas offer incentives to expansion, she said.

States in the Southern Plains seem to be taking advantage of better forage conditions, aggressively trying to rebuild herds after drought-induced liquidation, she said.

Beef cows are up 7 percent in Texas and 6 percent in Oklahoma, accounting for 62 percent of the total increase in beef cows. Combined with a 4 percent increase in Kansas and a 3 percent increase in Missouri, the four states make up 82 percent of the total increase, said Derrell Peel, livestock marketing specialist with Oklahoma State University.

An increase in the beef cow herd was expected, but the increase was larger than anticipated, he said.

There were a couple of other surprises as well, Sampson said.

Despite good pasture and grassland conditions in Nebraska, beef cows in that state declined 1 percent, down 11,000 head. Beef cows numbers in California, on the other hand, held steady despite severe drought and the closing of the National Beef Packing Co. processing plant in Brawley, she said.

The lack of beef cow growth in North Dakota and South Dakota was also surprising — down 2 percent in North Dakota and flat in South Dakota, Peel said.

Beef replacement heifers showed a similar trend, up noticeably in Texas, Oklahoma, Kansas, and California and down in Nebraska, Sampson said.

Beef replacement heifers were up 25 percent, 80,000 head, in Oklahoma; 8 percent, 50,000 head, in Texas; 8 percent, 20,000 head, in Kansas; and up 9 percent, 10,000 head, in California, while Nebraska was down 2.5 percent, 10,000 head, NASS reported.

South Dakota also showed a sizeable increase of 12 percent or 40,000 head, Peel said.

The year-over-year increase in beef replacement numbers indicates that further expansion is planned on the part of cow-calf producers, he said.

Higher female numbers on ranches uphold the fundamentals of tight supply, high demand and high prices, Sampson said.

The numbers indicate more aggressive expansion than expected, but a lot is going to depend on weather. Drought could hurt pasture and grassland conditions as well as corn and hay production, she said.



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