The U.S. Department of Agriculture’s (USDA) annual Cattle Inventory Report released last month confirmed expansion continued throughout cow country, according to Drovers.
All cattle and calves inventory increased by 1.8 percent from last year to 93.6 million head on Jan. 1, according to the report.
The agency’s report leaves little doubt that the industry is still in expansion mode at least for now.
Keys to future cattle and beef supplies are the beef cow inventory and the number of heifers being held for future replacement or entry into the herd. Cow-calf operators indicated they are holding back 1.2 percent more heifers for herd replacement this year than last year.
USDA estimated the beef cow herd to be up 3.5 percent compared to a year earlier and more than seven percent larger than at inventory bottom in January 2014.
Texas ranks highest with more than 4.46 million head—an increase of 170,000 beef cows, according to the report. Oklahoma ranks second in total numbers, but the state’s increase of 172,000 head was the most of any state.
The USDA did not provide a preliminary estimate of the 2016 calf crop back in July since the mid-year cattle report was dropped from USDA’s line-up of inventory reports. Last week’s report provided the first estimate of the 2016 calf crop with a 2.9 percent increase from the previous year at 35.1 million head.
Cattle slaughter and beef production are both expected to increase again during 2017. Commercial cattle slaughter and beef production increased just over 6 percent during 2016.
But larger supplies could push slaughter cattle prices down another 6 to 8 percent as a result of the expected supply increase.