Livestock Analyst Previews USDA Cattle Inventory Report

Cow slaughter not all driven by the drought.

Published on: Jan 19, 2012

The Ag Department will release its semi-annual U.S. cattle inventory report at the end of the month.

Purdue University Livestock Analyst Jim Mintert says the only debate surrounding the report is the extent of the decline in cattle and calf numbers. He's anticipating a 2% drop.

"Drought has been the big story in much of cow-calf country this past year, maybe a year and a half in some locations," Mintert said. "You think of places like Texas, our number one beef cow state in the nation, severely impacted by drought; Oklahoma, parts of Kansas. But as you look at other parts of the country we have actually moved some of those animals around and when we see the reports it's going to be very interesting to see the state data and discover how many states actually increased their cow inventory verses those that were losing."

In January a year ago USDA pegged the nation's cattle herd at 92.6 million head, the smallest in 53 years. According to Mintert, drought isn't the only reason herd liquidation is occurring. He notes that cow slaughter actually shifted into a higher gear six years ago in response to dramatically higher feed costs.

"Cow slaughter wound up in 2011 about 6.7 to 6.8 million head," Mintert said. "Look at the years in between, which were not necessarily driven by drought. We were increasing cow slaughter all the way back to 2005, so it's not all driven by drought. Weak returns are a consideration there; the lack of profitability among some cow herds has been a concern and one of the drivers of the increase in cow slaughter."

From 1925 to 1975  the beef industry was relatively healthy as demand and production grew with the population and income growth. The last 35 years look a lot different. Since '75 the number of cattle and calves has fallen by 40 million head.