Weekly female beef cow slaughter approached 750,000 head more than a year ago last week, said the Livestock Marketing Information Center in a letter to Extension agents called Livestock Monitor.
HEIFER KILL UP
Total heifer slaughter through the week ended Oct. 1 was 364,000 head more than last year, while beef cow slaughter was 336,000 head more than last year, the LMIC said. Last year, fourth quarter female beef cow and heifer slaughter outpaced 2020 by 154,000 head.
Given the pace of current slaughter, a reasonable estimate would conclude US female slaughter will be more than 800,000 head by the end of the year, the LMIC said. Using a simple regression analysis of data back to 1987 this would imply a Jan. 1 beef cow herd number that is down 4.8% – greater than the largest decline seen in the 2011-2015 time period.
The difference has been the larger number of heifers moving through slaughter channels, the LIMC said. It would suggest an unprecedented proportion of female slaughter in the last several decades relative to herd inventory.
The proportion is fairly off trend line from what is typically seen based on the LMIC regression analysis, the LMIC said.
WHAT NEEDS TO HAPPEN
However, to put this year back to normal relationships, several things would need to happen, the LMIC said.
The first is female slaughter in the fourth quarter would need to register below a year ago to the point of generating a net negative relative to last year, the LMIC said. The highest proportion of female and cow slaughter relative to the previous Jan. 1 inventory prior to 2022 was 43.7%.
Even if the fourth quarter female kill was even with a year ago, 2022’s proportion would be 46.8% of the Jan. 1, 2022, beef cow herd, the LMIC said.
The second metric LMIC looked at was the relative decline in the cow herd compared to the number of females slaughtered, the LMIC said. The 2022 data point assumed female slaughter in the fourth quarter was 50,000 head fewer than last year and was well below trend.
To put that forecast more in line with historical relationships, the beef cow number on Jan. 1 would only decline 2.8%.
These certainly are unique times, and beef cow and heifer slaughter analysis may be less helpful than in history because of the already very high proportion of female slaughter represented in Jan. 1, 2022, beef cow herd data, the LMIC said.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $150.00 to $153.84 per cwt, compared with last week’s range of $145.28 to $153.00. FOB dressed steers, and heifers went for $233.26 to $238.56 per cwt, versus $228.72 to $239.18.
The USDA choice cutout Tuesday was down $1.02 per cwt at $262.63 while select was down $1.73 at $232.73. The choice/select spread widened to $29.90 from $29.19 with 114 loads of fabricated product and 19 loads of trimmings and grinds sold into the spot market.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $2.15 to $2.25 a bushel over the Dec futures and for southwest Kansas were steady at $1.00 over Dec, which settled at $6.97 3/4, up 6 1/4.
The CME Feeder Cattle Index for the seven days ended Monday was $176.97 per cwt up $0.51. This compares with Tuesday’s Nov contract settlement of $176.92, down $0.70.