The USDA Cattle on Feed Report and the Cattle Inventory Report were both released in the last two weeks. It is time to think ahead about what lessons we may learn from the past year, and how our industry will respond moving into 2022. There’s no doubt it has been a tough year in many ways. The ongoing pandemic affected just about every industry, including ours. The cattle industry also had to contend with droughts in some parts of the country. Even so, it seems our industry has weathered these challenges better than many other industries, and the state of the industry looks strong going forward this year.
When the USDA released the Cattle on Feed Report, they revealed that cattle on feed is up 1% in the U.S. Placement in feedlots was up 6% from 2020. AG Web Farm Journal reports that the large December jump is due to drought in many western states. “The larger number of heifers in feedlots signals herd contraction continues, at least partially due to drought conditions in pastures.”
The Cattle Inventory Report revealed that U.S. cattle inventory is down 2% from a year ago. The report also found that the calf crop was down 1% from the previous year. What does this mean for the business? That depends on how one interprets those numbers, but there is a sense of optimism in the industry. Progressive Farmer interprets the report with a sense of bullishness. “Fewer beef cows means there will undoubtedly be a small calf crop to market and given that beef demand is as robust as it is,” they reported, “cattlemen should be able to demand more for their calves this upcoming year, and potentially even in the years ahead.”
Bloomberg was less bullish, though ntheir reporting comes more from a consumer point of view. They expect beef prices to remain high for consumers, but note that demand remains high despite rising prices, which certainly bodes well for the industry.
Of course, much depends on drought and other weather conditions going forward. There will surely be much talk of the Cattle Report at the Cattle Industry Convention & NCBA Tradeshow in Houston. This is a wonderful opportunity for our industry to come together, reflect, and improve our business in the year ahead.