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July report shows declining cattle inventories

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Drought has been the main factor contributing to the decline in the number of beef cows and replacement heifers.

Last week USDA published the July Cattle Inventory, which showed lower year-over-year inventories for most reported categories. While inventories posted a year-over-year decline, NASS estimates were higher than pre-report expectations, with analysts expecting larger decreases in cattle numbers. The full report is available on the USDA-NASS website.

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Total cattle inventories totaled 98.8 million, falling below 100 million for the first time since 2015, when inventories totaled 98.1 million. Total cow inventory decreased 2 percent year over year. Beef and dairy cow inventories were 2.4 percent and 0.5 percent lower compared to July 2022, respectively. The report confirms another year of beef cow herd liquidation with little evidence of anyone looking to expand. Heifers held as beef replacements were 3.5 percent lower compared to last year.

Drought has been the main factor contributing to the decline in the number of beef cows and replacement heifers.Total beef cow slaughter through June is 14.6 percent higher year over year. Nationally, weekly auction receipts also indicate a larger number of heifers being sold. Regionally, drought pressure this month has been a big concern in the Southeast. The effects of drought are shown in the auction data. For example, auction receipts for Arkansas show a 20 percent increase in slaughter cattle sales (see table).

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The July Inventory report also suggests tighter feeder cattle supplies (both current and future). USDA expects the 2022 calf crop to be 34.6 million head, down 1.4 percent year over year and the lowest level since 2015. Feed cattle supplies outside of feedlots totaled 35.7 million head, down 3 percent from the July 2021 total of 36.7 million head.

Last week’s Cattle on Feed report indicates that we might already be seeing tighter feeder cattle supplies. June feedlot placements totaled 1.63 million head, down 2.4 percent year over year and the lowest June placement total since 2016. July cattle on feed inventories are close to even with last year, totaling 11.340 million head.

Source: University of Arkansaswhich is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset. 

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