Farm Talk

Livestock

September 25, 2013

How fast can the beef cow herd be rebuilt?

(Continued)

Parsons, Kansas —

Additionally, there are indications that replacement heifers were diverted into feeder markets in the first half of the year, part of the residual effects of drought, reduced hay supplies and extended winter impacts. The combination of larger cow slaughter (smaller than expected reductions) and decreased heifer placements is likely to result in a year over year decrease of 0.75 -1.25 percent in the beef cow herd as of January 1, 2014. There are indications that heifer retention will accelerate this fall with cow-calf producers holding more heifer calves for breeding.

Most herd expansions in the past have included one to two years of minimal or modest herd growth before accelerating for two to three years. Herd expansion prospects for 2014 include both factors that suggest potential for faster than normal growth and factors that will limit growth. The young and productive base herd suggests the potential for one of two years of very minimal cow culling which would contribute to faster growth. A year over year drop in beef cow slaughter of roughly 20 percent in 2014 would correspond to a culling rate of less than nine percent, a low rate typical of herd expansion. With such a young herd, an even bigger decrease in cow culling is possible (less than eight percent) but such a large decrease in cow slaughter might result in significant disruption in lean beef (hamburger) supplies. The sharply higher cull cow prices that would result will mitigate some of the decrease in cow slaughter. At that same time significantly more replacement heifers may be reported on Jan. 1, 2014 but it will likely include a higher than normal percentage of heifer calves that will not produce a calf until 2015.

The situation described above suggests that it may be possible to see relatively rapid growth in the cow herd in 2014. Though 2013 is likely another year of herd liquidation, the improvement in conditions in the second half of the year may provide the period of herd stabilization (with little or no growth) that often occurs in first year of herd expansion. As long as drought conditions continue to moderate, beef cow herd growth of two percent is possible in 2014 with another 2-3 percent in 2015. Growth faster than this is unlikely when all factors are considered although slower growth is certainly possible. Among several implications, the reduction in cow and heifer slaughter that this growth implies is expected to lead to a roughly seven percent decrease in total cattle slaughter in 2014. £

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