Beef Buzz News
Don Close Expects Smaller US Beef Cow Herd in 2022
Wed, 24 Nov 2021 08:06:43 CST
An indicator of U.S. cattle supplies is beef cow herd numbers. As producers were forced to shrink their herds due to lower processing capacity, drought and high feed prices, Don Close, senior vice president for food and ag research, animal protein at Rabo AgriFinance, suspects a smaller beef cow herd heading into 2022.
Listen to Ron's conversation with Don here.
“When we got that 2% decline in beef cow numbers in the mid-year report, at the time that seemed really radical to me,” Close said. “We peaked in cow herd numbers in 2019. While that liquidation has been slow until 2021, once we get through that backlog inventory, we will see a noticeable decline in the availability of replacement cattle in 2022.”
Close said the industry can expect big reductions in fed-cattle supplies and total beef production in the second half of 2022. With tighter numbers ahead, it could be problematic should the cattle industry embrace the newly proposed Cattle Price Discovery and Transparency Act. At this point, that calls for a rolling average of mandatory, minimum sales by negotiated cash trade.
“I think we need to go back and look at cash sales as a percentage of cattle on feed,” Close said. “That would give us a longer lead time of how many cash cattle we know we will need to sell in any given month, but also give us more flexibility to accurately reflect what marketing supplies are available seasonally and cyclically.”
Like many economists, Close warns that broad mandates could cause more harm than good in an industry as complex as the U.S. cattle industry.
Click on the LISTEN BAR below to hear more from Ron Hays and Don Close as they talk about 2022 beef herd outlooks.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR below for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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