Small Heifer Retention Equals Elevated Beef Price Projection

With your Southeast Regional Ag News, I am Haylie Shipp. This is the Ag Information Network.

USDA released a bearish Cattle on Feed report in October, showing cattle on feed at 11.5 million head, the second-highest figure on record. Bernt Nelson, American Farm Bureau Federation Economist, explains what this means for cattle markets going forward…

“We have a lot of cattle that are being placed on feed, and a very high percentage—near 40 percent of those cattle are still heifers. During the short run, this means that we're going to have a very high supply of cattle come in the market, but in the long run this takes a lot of cattle out of the market that could have otherwise been held back for replacements. We've been going through this for a couple of years now, but now as this happens, we're looking at 2024 at the earliest before we can even consider starting to replace this cattle herd.”

Nelson says consumers will likely feel the pinch of higher beef prices next year…

“So, what this means for consumers is record beef prices in 2024 and 2025. A lot of the economy situations--we're talking about recession, we're still talking about inflation and where our money is at-- are going to dictate the ability of the economy to sustain these high beef prices or if consumers will start switching over to other substitutes like pork and chicken.”

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