In today’s Beef Buzz, senior farm and ranch broadcaster Ron Hays speaks with Dr. Derrell Peel, who says heavier cattle and bigger carcass weights are creating both opportunities and concerns across the beef industry.
More Days on Feed Means More Beef Production
Peel said the latest Cattle on Feed report reflects a continuation of a trend the industry has been watching closely—fewer cattle are being placed into feedlots, marketings are down, and cattle are staying on feed longer, resulting in heavier carcasses.
According to Peel, larger carcasses mean more total beef production, including more trimmings for ground beef. “Bigger carcasses also produce more trim in general, and so we are producing a lot of those 50% fatty trimmings that we need lean beef to mix with,” Peel said. “That’s what’s driving a lot of the import demand.”
Higher Carcass Weights Also Mean More Fat
However, Peel noted that added weight doesn’t just translate to more meat—it also means significantly more fat. “We are getting some additional pounds of meat, but we’re getting a lot more external fat on these cattle,” Peel said.
He pointed to rising yield grades as evidence of that shift. “The yield grade four and five percentage right now is at a record level in this country, with over 25% of all cattle grading yield grade four and five.”
While that extra fat may not directly benefit consumers, Peel said it still carries value in today’s market. “That’s not meat for consumers, but it is a product, and because of the value of tallow, packers have had no incentive to rein in feedlots relative to these carcass weights up to this point.”
Heavy Cattle Face Heat and Health Risks
Peel also warned the industry may be approaching physical limits with today’s heavier cattle, especially during summer heat. “I think we are reaching potentially some physiological limits on these cattle,” Peel said. “We are pushing them to very heavy weights.”
That added weight can create structural and health challenges. “We’re physically, structurally challenging these animals just to carry that weight at the end, and we are starting to see some additional health problems that can crop up,” Peel said. “Hot weather can really contribute to that.”
Exports Holding Steady Despite High Prices
On exports, Peel said there has been some progress with China after export plant recertifications, but no major breakthrough yet. “We did make an important first step in getting China to recertify export plants, so from a regulatory standpoint, it’s at least possible to export,” Peel said. He said it may take another month or two before export data reveals whether shipments to China are increasing.
Even with record-high cattle prices, Peel said U.S. beef exports have remained relatively resilient. “Beef exports have actually held up fairly well,” Peel said. “We haven’t really seen the kind of decrease across the board to our various markets that you might expect given the fact that we’re at record high prices.”
Cow-Calf Producers Still Facing Tight Supplies
For cow-calf producers, Peel said the broader market outlook remains largely unchanged despite the latest feedlot numbers. “I don’t think this really changes anything,” Peel said.
He emphasized that while on-feed inventories remain large, the overall cattle supply continues to tighten. “We are producing less cattle. Numbers continue to tighten.”
Peel added that there is still little evidence of widespread heifer retention, due in part to ongoing drought concerns. “We don’t have a lot of indication yet that we’re retaining very many, if any, heifers at this point,” Peel said.
Looking ahead, Peel expects tight supplies to continue supporting strong cattle prices. “We continue to see very strong prices, with a lot of volatility in some cases, but nevertheless, on average, we expect to see higher prices.”
And while many expected the tightest supply pressure to hit later this year, Peel said that timeline may be shifting. “Most of the real pressure from tighter supplies is still ahead of us,” Peel said. “It’s beginning to look like we might even push that off to next year.”
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Ag Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR above for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
