U.S. beef cow inventory at record low

While rising market prices will typically spur an increase in herd inventories — 2023 has seen remarkably high prices for beef, rising more than 25 percent above 2022 numbers — high input costs have largely undercut that impulse, Mitchell said.

By Ryan McGeeney
U of A System Division of Agriculture

JAMES MITCHELL — Managing costs is where the profits are for those raising beef cattle. (Division of Agriculture image)

July 28, 2023

 Fast Facts:

• Overall cattle inventory down 3 percent, lowest since 2014
• Beef cow inventory lowest on record
• High input costs, drought contributing to reduced herds

(735 words)
(Newsrooms: With graphic)

LITTLE ROCK — Beef cattle inventories in the United States are at record low numbers, according to a U.S. Department of Agriculture report issued earlier in July.

USDA’s Cattle Inventory report, released each July, gives a snapshot of the cattle industry on a national scale. A similar report, released each January, breaks numbers down on a state-by-state basis. According to the most recent report, the U.S. cattle industry in aggregate has reduced its inventory by 3 percent to 95.9 million head, the lowest since 2014. The inventory of beef cows in particular fell to 29.4 million head, 3 percent lower than the January 2022 inventory and the lowest number on record since 1971, when USDA began collecting such data.

James Mitchell, extension livestock economist for the University of Arkansas System Division of Agriculture, said the overall decline in inventory was expected, propelled by two well-known factors: the high cost of production and drought.

“It seems like every time drought abates in one part of the country, it pops up somewhere else,” Mitchell said. “Two years ago, we had a terrible drought in the western part of the country — Colorado, Montana, Wyoming. Last year that drought moved over the plains states, from North Dakota all the way down to Texas. Currently, that drought has moved either farther east, so it’s hitting Missouri and Iowa.

“It’s shifted east, and impacted producers’ ability to retain heifers and to grow their herds,” he said.

Arkansas producers, while more or less in the same fight as everyone else, have at least managed to avoid the worst of the country’s drought effects, Mitchell said.

“Knock on wood, we’re pretty fortunate in the southeast right now, in that we have largely avoided multi-year long-term drought, while other parts of the country haven’t been so lucky,” he said.

Beef Cows: Inventory on July 1 by Year for the United States. (Image courtesy USDA)

Higher prices

While rising market prices will typically spur an increase in herd inventories — 2023 has seen remarkably high prices for beef, rising more than 25 percent above 2022 numbers — high input costs have largely undercut that impulse, Mitchell said.

“Higher prices generally mean that people should think about rebuilding their herds,” he said. “But we don’t make decisions based on prices, we make decisions based on profit. Currently, we’re seeing prices we haven’t seen since 2014, 2015 — but then, those higher prices translated to higher profits, because we weren’t battling the high input cost situation that we are today.

“We’re not going to see the same rate of expansion that we saw 10 years ago, because the profits aren’t there,” he said. “I think we’re going to see higher prices for a sustained period of time because nationally, the profits aren’t there for us to start building back herds.”

Mitchell said that in the current economic climate, profitability will hinge on producers’ efficiency.

“When you’ve got high cattle prices, the profits are going to go to those who are best at managing their costs,” he said. “If you can manage those correctly, there are profits to be made.”

To learn about extension programs in Arkansas, contact your local Cooperative Extension Service agent or visit www.uaex.uada.edu. Follow us on Twitter and Instagram at @AR_Extension. To learn more about Division of Agriculture research, visit the Arkansas Agricultural Experiment Station website: https://aaes.uada.edu/. Follow on Twitter at @ArkAgResearch. To learn more about the Division of Agriculture, visit https://uada.edu/. Follow us on Twitter at @AgInArk.

About the Division of Agriculture

The University of Arkansas System Division of Agriculture’s mission is to strengthen agriculture, communities, and families by connecting trusted research to the adoption of best practices. Through the Agricultural Experiment Station and the Cooperative Extension Service, the Division of Agriculture conducts research and extension work within the nation’s historic land grant education system. 

The Division of Agriculture is one of 20 entities within the University of Arkansas System. It has offices in all 75 counties in Arkansas and faculty on five system campuses.  

The University of Arkansas System Division of Agriculture offers all its Extension and Research programs to all eligible persons without regard to race, color, sex, gender identity, sexual orientation, national origin, religion, age, disability, marital or veteran status, genetic information, or any other legally protected status, and is an Affirmative Action/Equal Opportunity Employer.

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