Last week in this column, I wrote about the lower numbers of cattle from cattle producing countries worldwide. This week, I wanted to write about the low numbers of cattle in the U.S. and its effects.
On Oct. 23, cattle on feed placements fell 12.1 percent to 1.78 million head, the lowest number reported in September since 1996.
This shocking number raised eyebrows throughout the beef industry.
Cattle placed on feed in September are most likely finished in early 2027, meaning numbers of fat cattle will be missing when they go to meatpackers in early 2027. This will create a hole in the supply chain as packers will be looking for fat cows.
Feeders are feeding cattle longer for heavier fat cows, which may hurt as well.
These numbers are also concerning as heifers on feed fell just one percent to 4.3 million head, which is still around 38 percent of feedlot inventory. In the last real heifer expansion, this share typically ran 31 to 33 percent of feedlot inventory.
The latest report shows producers, for the most part, are sending heifers to feedlots and not keeping them for replacements to rebuild their cattle herds.
As many know, money isn’t money until it’s in your pocket, and due to drought, a lot of producers are low on forage and don’t want to buy expensive feed.
Another reason for low placements is the number of cattle coming from Mexico is less than expected, especially at the Santa Teresa, N.M. crossing, which has historically been the largest port.
Another reason is, with improved winter wheat pasture, both imported Mexican feeder cattle and U.S. cattle are grazing pastures for cheaper gain instead of going straight to feedlots.
All in all, there are a number of reasons for lower placements the last three months.
A report from the Federal Reserve Bank of Kansas City said, “High costs and uncertainty will likely keep cattle inventories low and beef prices elevated for some time.”
Food-at-home inflation keeps rising, as do beef prices. The truth is, beef prices have increased as U.S. consumption of beef has outpaced domestic supply.
Hamburger prices may be the most stable as more imports come into the U.S.
The report mentions uncertainty, and it is this uncertainty in the cattle business that is influencing heifer rebuilding, beef prices and cattle prices.
Despite the increased price of beef, the report said, “Consumption in the U.S. is expected to be eight percent higher in 2026 than its average over the last 20 years, likely due to a strong U.S. consumer demand for protein.”
Some in Washington, D.C. are looking for an aggressive rebuilding of America’s cattle herd. They are finding all kinds of programs to help ranchers and farmers and we appreciate it, but until we get through this ongoing drought in a large part of cattle country, it’s not going to happen. Inputs are going to have to drop as well.
Dennis Sun is the publisher of the Wyoming Livestock Roundup, a weekly agriculture newspaper available online and in print.
