Friday’s USDA’s National Agricultural Statistics Service semi-annual Cattle inventory report confirmed what traders already knew – the US herd is declining cyclically.
The report said that all cattle and calves in the US on July 1 totaled 100.9 million head, 1% fewer than the 102.2 million a year earlier. This compares with the most recent high of 102.8 million on July 1, 2018.
Compared with the Jan. 1 total inventory of 93.6 million, the total was up 7.3 million, or 7.8%, partly because of a January-June calf crop of 25.8 million head running ahead of the annual slaughter rate as they grow. The forecast number of calves coming in the second half was 9.3 million head, down 86,000, or 0.92%, from 9.386 million last year and down from the most recent cycle high in 2018 of 36.313 million.
CALVING RATE DOWN
As of July 1, the total number of cows and heifers that have calved came to 40.9 million head, down 500,000, or 1.21%, from 41.4 million a year earlier.
Of that, beef cow calvings came to 31.4 million head, down 650,000, or 2.03%, from 32.05 million a year earlier.
Dairy cow calvings totaled 9.5 million head, up 150,000, or 1.60%, from 9.35 million a year ago.
BEEF HEIFERS DECLINE; DAIRY NUMBERS UP
The total numbers of beef heifers weighing 500 pounds or more were down from last year while those destined for the milking parlors was up.
The USDA said the total number of heifers weighing 500 pounds or more was 16.0 million head, down 200,000, or 1.23%, from 16.2 million a year earlier.
Of that, beef cow replacement heifers totaled 4.3 million head, down 100,000, or 2.27%, from 4.4 million a year earlier. Dairy cow replacement heifers totaled 4.1 million head, up 100,000, or 2.5%, from a year earlier.
That extends a line of steady to lower July 1 replacement beef heifers going back to 2015. However, it’s still more than the lows of 4.2 million head recorded in 2011, 2012 and 2013.
Other heifers totaled 7.6 million head, down 200,000, or 2.56%, from 7.8 million a year ago.
STEER NUMBERS DECLINE
The USDA said the number of steers weighing 500 pounds or more declined from a year ago to 14.5 million head, compared with 4.7 million, a decline of 200,000, or 1.36%.
The number of bulls in the same weight category totaled 2.1 million head, unchanged from a year ago.
The total number of calves weighing less than 500 pounds came to 27.4 million head, down 400,000, or 1.44%, from 27.8 million last year.
CATTLE, BEEF RECAP
Fed cattle traded last week at $118 to $122 per cwt on a live basis, down $1 to $3 from the previous week. Dressed-basis trade was at $195 to $197, down $1 to $4.
The USDA choice cutout Friday was up $0.49 per cwt at $266.63, while select was up $0.17 at $249.94. The choice/select spread widened to $16.69 from $16.37 with 104 loads of fabricated product and 27 loads of trimmings and grinds sold into the spot market.
The USDA reported Friday that basis bids for corn from livestock feeding operations in the Southern Plains were unchanged at $1.86 to $1.91 a bushel over the Sep futures and for southwest Kansas were unchanged at $0.70 over Sep, which settled at $5.47 1/4 a bushel, down 17 1/4.
The CME Feeder Cattle Index for the seven days ended Thursday was $152.03 per cwt up $0.64. This compares with Friday’s Aug contract settlement of $160.07 per cwt, up $1.87.