Declining Cattle Inventory Equates to an Expected Rise in Beef Prices
Cattle inventory data show US cattle herd has declined again and is now the smallest herd size since 1951, which will adversely affect beef prices. This will be exacerbated by the trend to hold back heifers for breeding to build up the herd size over the next 2-3 years.
Why is the cattle inventory down?
- The number of beef cows that gave birth in 2013 was reported at 29.042 million, down 0.9% from a year earlier.
- Trend now is to hold back heifers for breeding to build up the herd size, thus the number of beef replacement heifers was below forecasts.
- Pasture conditions depend of adequate rainfall and some areas have been very dry to drought conditions for nearly 3 years.
- Drought has reduced cattle herds and caused a lot of feeder cattle to be marketed at lower weights, resulting in less choice- beef at higher prices.
- Unusually cold weather slowed cattle weight gains, also reducing the number of cattle coming to market.
What does this mean to the consumer?
- Beef and Veal prices are expected to rise.
- Grinding meats (ie ground beef) will become even more sought after to be incorporated into less expensive meal planning which could drive the price up.
- Prices are already being affected in the winter / off season, and there is only speculation to what levels will be when the summer BBQing season is in full swing.
- Consumers may very likely look for alternate protein sources driving the price up for those ie chicken, pork
In summation, we’re not going to have as much beef this year and we, unfortunately, can expect climbing prices.