THE SUSTAINABLE CHOICE BEEFMASTER

ZERO MORTALITY 94% CHOICE OR BETTER

Fundamentals Drive the Bus

Reasons behind the prolonged, steeply higher price path have everything to do with significantly fewer cattle and reduced beef production in tandem with extraordinarily resilient consumer beef demand (more later).

The U.S. beef cow herd at the beginning of 2023 was the smallest since 1962, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University (OSU), providing market insights at the recent Cattlemen’s Conference at OSU.

Likewise, Stephen Koontz, agricultural economist at Colorado State University pointed out in June that feedlot inventories were the snuggest in three years.

“Cattle on feed inventories continue to tighten from the peaks in 2022,” Koontz explained, in the Livestock Marketing Information Center’s In the Cattle Markets. “The beginning of June saw an inventory of 11.55 million, roughly even with the beginning of June 2018. And there will be more and more of this to come with the level of heifer and beef cow slaughter.”

Even so, Peel explained on-feed inventories likely won’t bottom (12-month moving average) until later this year or in 2025.

Estimated year-to-date total cattle slaughter through the last week of June was 580,000 head fewer (-3.4%) than the same time a year earlier. The same week estimated year-to-date beef production was 640 million lbs. less (-4.6%).

Nation’s Herd Still Contracting

ZERO PULLS

4.4 POUNDS PER DAY IN THE YARD 160 DAYS ON FEED

16% QUALIFIED FOR CAB PREMIUMS

AVERAGE YIELD GRADE 3

By all accounts, national beef cow liquidation continues this year while yearling fed heifer slaughter remains elevated, albeit less so than last year. History says prices will find their peak when heifer retention and reduced beef cow slaughter weigh further on beef production.

“The first step to stabilizing the beef cow herd is the reduction of beef cow slaughter and a lower rate of cow culling,” Peel explained in his midJune market comments. “Following record beef herd culling in 2022, beef cow slaughter is down 11.5% so far in 2023, a sign that herd liquidation is slowing. However, I suspect that, until recently, the decrease in total beef cow slaughter was masking some continued liquidation in the drought areas of the plains ... Beef cow slaughter is expected to decrease more sharply in the second half of the year.”

Definitive indication of herd expansion will come with increased heifer retention, according to Peel.

“Right now, no such signs exist, though I suspect that some heifer retention is beginning,” Peel said. “In

Seedstock Plus Fall Sales!

On-Line Showcase Sale!

Opens August 19th - 8 a.m.

Closes August 19st - 8 p.m. (soft close)

Approximately 60 Balancer & Gelbvieh

Fall Bred & Open heifers & Embryo packages from Seedstock Plus Members!

Watch the website & Facebook page for updates and information!