Drought conditions remain historically bad for this time of year, and USDA data confirms that the situation is critical for the beef cattle industry, said Oklahoma State University Extension Livestock Marketing Specialist in a letter to Extension agents called Cow/Calf Corner.
USDA-reported pasture and range conditions from May through October and the initial reports this year showed US pasture conditions were the worst ever for May in data back to 1995 with 44% reported in poor and very poor condition, Peel said. Among the worst states were Arizona (90% poor to very poor), North Dakota (75%), Utah (71%) and New Mexico (65%).
REGIONAL DIFFERENCES
Regional aggregations compiled by the Livestock Marketing Information Center showed the West region (AZ, CA, ID, NM, NV, OR, UT, WA) with 51% of pastures in poor to very poor condition, he said. The Great Plains (CO, KS, MT, NE, ND, SD, WY) had 43% in poor to very poor condition. The Southern Plains (OK, TX) had 29% of pastures in poor to very poor condition.
The three regions account for 60.6% of the total beef cow inventory, and currently 40.1% of all beef cows in the country (12.67 million head) are in states with 40% or more poor to very poor pasture and range conditions, he said.
Total US hay stocks for May 1 were 18.0 million short tons, down 11.8% year over year and down 13.7% from the 2015-2019 average, Peel said.
Among major hay states, Colorado hay stocks were down 43.9% year over year and down 60.3% from the five-year average. Kansas stocks were down 35.9% year over year and down 11.7% from the five-year average, he said. Missouri was down 29.1% year over year and down 13.7% from the average.
Nebraska stocks were down 27.5% from one year ago and down 13.0% from the five-year average, Peel said. Texas was down 38.5% from one year ago and down 44.4% from the five-year average.
The West region had May 1 hay stocks down 24.9% year over year and down 34.1% from the five-year average, Peel said. Great Plains stocks were down 20.1% year over year and down 6.4% from the five-year average.
Southern Plains May 1 hay stocks were down 28.8% from last year and down 29.3% from the five-year average, he said.
COW SLAUGHTER UP
Beef cow slaughter increased in the latest data to levels not seen since 2020 fall cow culling, Peel said. Weekly beef cow slaughter increased 13-14% in the latest two weeks of data over the previous six-week average.
It appears herd liquidation is happening, and more can be expected, he said.
CATTLE, BEEF RECAP
Fed cattle traded this week at $119 to $120 per cwt on a live basis, up $1 to down $2 from last week. Dressed-basis trading was at $189 to $191 per cwt, steady to down $1.50.
The USDA choice cutout Wednesday was up $0.04 per cwt at $323.38, while select was up $0.64 at $299.69. The choice/select spread narrowed to $23.69 from $24.29 with 72 loads of fabricated product and 51 loads of trimmings and grinds sold into the spot market.
The USDA reported Wednesday that basis bids for corn from livestock feeding operations in the Southern Plains were not available but Friday were unchanged at $1.05 to $1.19 a bushel. The Jul CBOT futures contract settled Wednesday at $6.58 1/4 a bushel, unchanged.
The CME Feeder Cattle Index for the seven days ended Tuesday was $133.80 per cwt up $0.10. This compares with Wednesday’s May contract settlement of $136.57 per cwt, down $0.62 and Aug’s $152.87, up $0.95.