– Dr. Kenny Burdine, Extension Professor, Livestock Marketing, University of Kentucky

As I write this article in early October, beef cow inventory is at a 62 year low. Tight supplies have driven cattle markets and calf prices have increased by roughly $1 per lb over the last two years. With limited heifer retention and beef cow slaughter on track to exceed 10% of beef cow inventory for the year, it appears very likely that beef cow numbers will be even lower going into 2025. At some point, we will expand this cowherd but there appears to be little evidence that producers have an appetite for that currently. In order for the cow herd to grow, we need to have the 3 Ps of herd expansion at the cow-calf level: profit, pasture and patience.

The first P is probably the most obvious – profit. There will be no interest in cowherd expansion if money is not being made at the cow-calf level. While profit has largely been there recently, it is important to remember that these Continue reading The 3 Ps of Herd Expansion: Profit, Pasture and Patience →

– James Mitchell, Livestock Marketing Specialist, University of Arkansas

Over the past two years, drought conditions have worsened rapidly each September, coinciding with the start of fall marketings for calves and cull cows. Typically, large volumes of these cattle come to market in October and November, following a well-established seasonal pattern. This influx of cattle puts downward pressure on prices, with October historically seeing the lowest cattle prices of the year. However, drought pressure has likely caused producers to adjust their marketing strategies. A closer look at state-level auction receipts can provide insight into how these changes are playing out.

The first graph in this article (above) shows monthly feeder cattle auction receipts for Arkansas, Kentucky, Missouri, and Mississippi. In 2021 (red line) and 2022 (green line), the seasonal peak in receipts occurred Continue reading Two Years of Fall Drought Impacting Marketing Strategies →

– Hannah Baker, M.S., State Specialized Extension Agent – Beef and Forage Economics, Range Cattle Research and Education Center, University of Florida / IFAS Extension

The fall months are when a majority of producers across the country are selling spring-born calves or yearlings from last fall. Due to the increase in supply of calves, prices typically decline during these months. A way to show this seasonality trend is to look at the seasonal price index. The average annual price index shows the relationship between each month’s average price and the annual average price. When the price index is above 100%, that means prices in that month, on average, are higher than the annual average, (spring). When the price index is below 100%, that means average prices in that month are lower than the annual average, (fall).

The maximum and minimum indices are used to show the approximate range of prices during that month. For example, during Continue reading Seasonality in Feeder Cattle Prices →

– Josh Maples, Assistant Professor & Extension Economist, Department of Agricultural Economics, Mississippi State University

The latest USDA Cattle on Feed report was released Friday and showed placements of cattle into feedlots during August were 1.4 percent lower than during August 2023. Marketings of fed cattle out of feedlots were down about 3.5 percent from a year ago, partially due to one less business day in August 2024 than in August 2023. Both of these numbers were within pre-report expectations and will likely not be big market movers.

Most of the decline in placements from a year ago occurred in placements of cattle weighing less than 800 pounds. Placements of cattle in this weight range were 3.4 percent lower while placements of cattle weighing more than 800 pounds were 1.4 percent higher. Placements in both Kansas and Nebraska were down about 3 percent while placements in Texas were Continue reading Cattle on Feed and Record-High August Fed Cattle Weights →

– Dr. Kenny Burdine, Extension Professor, Livestock Marketing, University of Kentucky

How do you value time in the hay field?

As an Extension Economist, I regularly have the opportunity to talk about cow-calf profitability. I usually start with revenues, talking about calf prices and making assumptions about weaning weight and weaning rate. Then I walk through costs like winter feed (hay), pasture maintenance, breeding, vet / medicine, trucking, sale expenses, etc. While there is always room for discussion, most of these expenses can be estimated on a “per cow” basis by making some reasonable assumptions. At some point in the discussion, I bring up the topic of labor. Some cow-calf operations hire a significant amount of labor, but for a lot of these operations the majority of labor is unpaid operator labor.

The classic economist approach to valuing unpaid labor is to value it at its opportunity cost. By that I mean if the farmer could be making Continue reading When is an Hour of Operator Labor, Not Just an Hour of Operator Labor? →

– Rob Ziegler, Extension Specialist, College of Agriculture, Life Science and Natural Resources, University of Wyoming

The U.S. beef cow herd inventory has received significant attention recently, due to historically low levels driven by market prices and drought conditions that have incentivized producers to sell. Droughts impacted much of the U.S. in 2011-2014 and again in 2021-2023, coinciding with the contraction phase of the cow cycle. A closer look at cow slaughter during these contraction phases and drought periods could shed light on producers’ current intentions to rebuild and the potential trajectory of market prices.

Beef cow slaughter peaked in 2011 at 3.9 million head, roughly midway through the last contraction phase, which ended in 2014 when expansion began. Slaughter bottomed out in 2015 at 2.2 million head and started increasing again in 2016. Another peak in cow slaughter was observed in Continue reading Are We Nearing Expansion? A Look at Cow Slaughter and the Inventory Cycle →