U.S. cowherd liquidation one of the largest ever

Analysts are saying the largest liquidation ever could be under way in the beef industry. USDA’s Livestock Slaughter report, released Friday, Sept. 23, shows the nation’s beef producers sent 22.8 million head to slaughter from January-August, a one percent increase from the comparable period a year ago. For the month of August, commercial slaughter was 5 percent above July levels at 3.1 million head.

Mark Nelson, economist with the Kansas Farm Bureau, predicts that cattle numbers will be even tighter next year and in 2013. The liquidation that is occurring now is the largest or one of the largest drought-based liquidations ever, he said.

Heifer numbers are also lower. U.S. beef producers retained 5 percent fewer heifers than the previous year as of January 1, according to estimates released by USDA earlier this year.

Nelson says if current conditions – high corn and hay prices as well as severe drought in the southwest – persist and liquidation occurs into the fall, the breeding herd could decline by as much as 7 percent. “This would be a loss of 2 million head of beef cows,” he said. “This is huge and could mean a reduction in cowherd numbers this country hasn’t seen since the early ’60s.”

“Cow numbers continue to shrink,” said Glynn Tonsor, livestock economist with Kansas State University. He expects continued tight supplies of both feeder cattle and calves over the next 12 months. “That means the value of calves and feeder cattle will be historically high,” Tonsor said.

Analysts are saying the largest liquidation ever could be under way in the beef industry. USDA’s Livestock Slaughter report, released Friday, Sept. 23, shows the nation’s beef producers sent 22.8 million head to slaughter from January-August, a one percent increase from the comparable period a year ago. For the month of August, commercial slaughter was 5 percent above July levels at 3.1 million head.

Mark Nelson, economist with the Kansas Farm Bureau, predicts that cattle numbers will be even tighter next year and in 2013. The liquidation that is occurring now is the largest or one of the largest drought-based liquidations ever, he said.

Heifer numbers are also lower. U.S. beef producers retained 5 percent fewer heifers than the previous year as of January 1, according to estimates released by USDA earlier this year.

Nelson says if current conditions – high corn and hay prices as well as severe drought in the southwest – persist and liquidation occurs into the fall, the breeding herd could decline by as much as 7 percent. “This would be a loss of 2 million head of beef cows,” he said. “This is huge and could mean a reduction in cowherd numbers this country hasn’t seen since the early ’60s.”

“Cow numbers continue to shrink,” said Glynn Tonsor, livestock economist with Kansas State University. He expects continued tight supplies of both feeder cattle and calves over the next 12 months. “That means the value of calves and feeder cattle will be historically high,” Tonsor said.