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Agricultural News


The Role of Heifers in the US Beef Production System Continues to Grow According to Derrell Peel

Mon, 21 May 2018 11:05:29 CDT

The Role of Heifers in the US Beef Production System Continues to Grow According to Derrell Peel Mondays, Dr. Derrell Peel, Oklahoma State University Extension Livestock Marketing Specialist, offers his economic analysis of the beef cattle industry. This analysis is a part of the weekly series known as the "Cow Calf Corner" published electronically by Dr. Peel and Dr. Glenn Selk. Today, Dr. Peel takes a look at the growing role of heifers in beef production today.



"The heifer contribution to beef production depends on both heifer slaughter and heifer carcass weights. Heifer slaughter varies cyclically with additional heifer retention during herd expansion and reduced retention during liquidation, thus providing much of the variation in beef production in cattle cycles. Heifer slaughter as a percent of total steer and heifer (yearling) slaughter has averaged about 37 percent on an annual basis for the past 45 years, though heifers averaged less than 30 percent of yearling slaughter prior to 1965.



"During periods of herd expansion, the heifer percentage of yearling slaughter drops to roughly 31 percent and during periods of herd liquidation, heifers will contribute about 40 percent to total yearling slaughter. Most recently, a twelve month moving average of monthly heifer slaughter percentage bottomed at 31.4 percent in mid-2016 during aggressive herd expansion. Back in 2001, cyclical liquidation of the beef herd resulted in a heifer slaughter percentage of 40.3 percent. Most of the period from 1995-2013 was herd liquidation and the average heifer percentage of yearling slaughter was 38.2 percent. The beef cow herd expanded from 2014 -2017 and the heifer slaughter percentage averaged 33.4 percent during that period. Most recently, heifer slaughter has increased to an annual average of 34.3 percent of yearling slaughter as heifer retention slows down.



"The evolution of heifer carcass weights is even more interesting. Both steer and heifer carcasses have trended up for about 50 years. For example, heifer carcasses averaged 564 pounds in 1967 and 811 pounds in 2017. Heifer carcass weights have increased relative to steers over that period. Heifer carcasses averaged 84 percent of steer carcass weights until the 1970s; reaching 85 percent consistently by 1978. Heifer carcasses reached 86 percent of steers weights by 1982 and in just five years, from 1982 to 1987 shot up to 90 percent of steer carcass weights. By 1993, heifer carcasses were 91 percent of steer weights and by 1996 were 92 percent of steers. The percentage hovered around 92 percent until 2009, when it reached 92.2 percent, and increased to 92.3 percent in 2010. Heifer carcass weights have continued to inch up relative to steer weights. In December, 2017, the annual average heifer carcass weight reached 92.4 percent of steer weights for the first time and in the most recent months of February and March, 2018, the twelve month moving average of heifer carcass weight as a percent of steer carcass weight was a new record of 92.5 percent.



"Clearly, the industry continues to feed heifers more and more efficiently over time. There may, however be a downside. Research at Oklahoma State University has shown that big carcasses lead to big beef cut sizes which may limit demand. Anecdotal indications from the industry suggest that for a number of years, some markets for beef products have specified heifer sources to ensure smaller product sizes. The problem now is that heifer carcass weights in 2018 are the same size as steer carcasses were in 2005. Heifer carcass weights appear to have provided a buffer against big steer carcasses for the past decade or more but that may be coming to an end. It may be that cattle and carcass weights can physically continue to get bigger but there is a very real question of the demand implications and economic consequences of continued growth in steer and heifer carcass weights."




   

 

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