Hurt Says Cattle Herd Expansion Could Be Finished
(WEST LAFAYETTE, IN) In the latest Cattle on Feed report, USDA indicated a two percent increase in the numbers of cattle on-feed which was the largest inventory for July dating back to 1996. While a record, the numbers were in line with expectations prior to the report. According to Dr. Chris Hurt at Purdue University, the mix of steers and heifers provides further evidence that cow-calf producers are sending more heifers to the feedlots rather than holding them back for breeding stock compared to a year ago. Total on-feed numbers are two percent higher but the number of steers is down two percent while there’s an eight percent increase in heifers year over year. This lends additional support, Hurt explains, to the idea of leveling off of the herd expansion. Domestic beef production so far this year has been near unchanged with one percent more animals being offset by one percent lighter market weights. For the remainder of the year, numbers are expected to rise about two percent, but with a continuation of lighter weights, beef supplies may only rise by a modest one percent. Higher feed prices will generally support lighter marketing weights for the rest of this year and into 2020. Prices for finished cattle have been about $1 lower so far this year compared to the same period last year based on USDA’s five area direct cattle prices. In 2018 those prices averaged near $117. The 2019 average is $115.50 with an annual average near $116 for the end of the year. Two more reasons for cow-calf producers to not make major changes in herd size now are the ongoing trade uncertainties and the impact of 2019 weather on feed and forage supplies and prices.