Senior Farm and Ranch Broadcaster Ron Hays talked to OSU Extension Livestock Market Economist Dr. Derrell Peel after the latest USDA Cattle of Feed Report was released on Friday afternoon, and this is part two of that conversation where they are discussing the beef industry outlook for 2025. To see part one of the conversation, click here.
Dr. Peel noted the relatively small supply of bred heifers added to the nation’s cow herd this year and said that the outlook is really dependent on what producers do with their cows. Will cow slaughter tick upwards? Will drought conditions demand more liquidation and an upward trend of cow slaughter?
“By my estimation, if cow slaughter drops, on top of the near nineteen percent decrease last year on a year-over-year basis, if we drop cow slaughter another seven or eight percent this year, we can hold the cow herd stable this year,” he said. “If we drop it more than that, we can see a small amount of growth in the beef cow herd, but that is going to be pretty minimal at this point.”
The other side of that is drought causing further liquidation of cows and an even smaller cow herd.
He pointed out that the calving numbers on the latest report were the highest seen in more than twenty years by about one percent. Dr. Peel believes that is due to the high prices that calves are bringing in the marketplace incentivizing the production of more calves and managing the cows and calves better.
“The thing that has changed in the world is not only do beef producers have that incentive, but dairy producers do as well with these cross-bred calves and the value they are bringing on the beef side of things,” he mentioned.
Dr. Peel advised each producer to determine their potential in the current markets and consider restocking while being cognizant of upcoming weather trends. He said, “I think producers are just trying to find ways to take advantage of this market and we certainly expect it to continue through 2025 and even beyond.”
He referenced the currently short supply of cattle saying that they will remain in high demand for, at least, the next two or three years.
Regarding concerns that beef will soon reach its peak, despite short-term decreases in cutout values Dr. Peel doesn’t see it as a sign of any fundamental change in beef demand going forward. Once again, the shortened supply of beef will drive the market upward.
If heifer retention begins in earnest, the shortage will only intensify as feedlot numbers decrease.
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 for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
