The liquidation of the U.S. cow herd has been a big deal over the last couple of years. Senior Farm and Ranch Broadcaster Ron Hays talked to OSU Extension Livestock Market Economist Dr. Derrell Peel after the latest USDA Cattle on Feed Report was released on Friday afternoon to talk about cull cow liquidation.
In part one of this conversation, Peel said that feeders heifers is the biggest factor in how feedlots are staying relatively full with overall cattle numbers down.
“We’ve been lower most of the year on cull cow numbers, and normally, we see a seasonal increase in the fall of each year,” Peel noted. “We have not seen much of that increase this year so we are pulling them down even faster.”
Peel also noted that year to date, beef cow slaughter is down almost 18%, and there hasn’t been a lot price pressure because there aren’t as many cows being culled.
“Cow slaughter is down. If you convert that to our estimates for the year and then put it in terms of the herd culling rate, it is coming down from record levels about two years ago, and that is part of what we have to do, ultimately, to get into this mode of herd rebuilding, is we’ll cut cow culling down,” Peel said. “We are going to be at about average levels for this year, so we are down from record high levels, but not low enough yet to suggest that we are really actively rebuilding that herd. Guys are taking advantage of selling those cows for some awfully good money at this point.”
Peel anticipates that the January 1 Cattle Inventory Report will show that the U.S. cow herd has continued to liquidate in 2024 but may not be down by much. Still, he anticipates that even after 2025, it will show no increase in cow numbers. Looking back- the US Beef Cow Herd stood at 28.2 million head on January 1, 2024.
With significant rainfall improving conditions and the prospects for winter wheat, the Oklahoma feeder markets have leaped in the past two weeks, but even nationwide, feeder markets remain strong.
“From the standpoint of Oklahoma, we had an early fall run,” Peel said. “We were up on a weekly basis year over year through September and October. We’ve already moved the cattle that were out there, so now we are down. The numbers are quite tight, and I think that is true around the country, so we are seeing some very, very strong feeder cattle markets around the country, including here in Oklahoma.”
Now that producers have better water supplies, if not a little more grass, Peel says that it will be interesting to observe what their actions reveal about their expectations. While drought is still a slight threat, the heavy rainfall over the past few weeks has reduced its strength considerably.
“The real question as we go into 2025 is are these guys ready to think about some herd rebuilding and that will start, of course, with some heifer retention,” Peel said. “We don’t have any indication that it is happening yet, but at some point in time, I would expect that to happen and we have to wait and see if the industry is ready to start that process.”
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 at the top of the story for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
