The Cattle Market Cycle – How Long Will These Prices Last?

There is little indication currently of a rising cow inventory in the near future, said Mark Johnson, Oklahoma State University Extension beef cattle breeding specialist, a letter called Cow-Calf Corner.

There also is the potential for good profits for cow/calf producers in the short term, he said.

The current cattle cycle, the multi-year pattern of expansion and contraction of the total US cattle herd, appears to be somewhere near the bottom where calf and cow prices are rising or higher than their recent lows, a market analyst said.  There is tension in the country indicating a desire among cow/calf producers to begin rebuilding their herds, if conditions allow.

Getting an increase in slaughter-ready, fed steers and heifers, though, will take two years or more, even if herd rebuilding began today, the analyst said.  The physiology of cattle will not allow a faster process.

Also, drought-stricken pastures take time to recover after rains return, the analyst said.  At first, they will not support as many cows as before the drought.




The cattle cycle reflects the effect supply and demand have on cattle prices, Johnson said.  When cow inventory is low, the prices of calves and all age and weight categories of cattle will move higher and vice versa.

At the onset of 2024, the national cow inventory was the lowest since the early 1960s, and prices of calves, yearlings, fed cattle and cull cows were historically high, Johnson said.  High profit potential exists for the cow/calf sector in 2024.

But there are roadblocks, the analyst said.




The question being asked and debated in early 2024, is how long will current conditions last, Johnson said.

As of now, there is little indication of a rising cow inventory in the near future, Johnson said.  Why?  Several factors are working against it, they include:

  • High interest rates
  • High numbers of cull cows marketed in 2023
  • Persistence of drought in parts of the country
  • Low hay and feed inventories relative to drought
  • Age demographic of cattle producers who have liquidated cow inventory
  • Little evidence of heifer retention


Those factors, coupled with cow biology and the long term process involved in turning replacement heifers into cows, indicate a slow rebuild, Johnson said.

Bottomline: The economic future looks bright for those in the cow/calf sector with inventory, Johnson said.  The cow/calf sector serves as the initial source of product in the beef production chain.

For producers who can effectively manage the expense of maintaining a cow herd, the value of weaned calves should lead to excellent profit potential, Johnson said.




The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $178.91 per cwt to $179.26, compared with last week’s range of $172.98 to $178.85 per cwt.  FOB dressed steers, and heifers went for $278.69 per cwt to $278.89, compared with $272.94 to $280.41.

The USDA choice cutout Monday was up $0.40 per cwt at $293.48 while select was up $0.30 at $283.77.  The choice/select spread widened to $9.71 from $9.61 with 65 loads of fabricated product and 20 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 to down $0.04 at $1.35 to $1.45 a bushel over the Mar corn contract, which settled at $4.42 3/4 a bushel, unchanged.

No delivery intentions were posted for the Feb live cattle contract.

The CME Feeder Cattle Index for the seven days ended Friday was $239.48 per cwt, up $0.31.  This compares with Monday’s Mar contract settlement of $242.75, down $2.05.