Cattle Inventory Report neutral compared to expectations

USDA estimated there were 87.157 million head of cattle in the U.S. as of Jan. 1, down 1.684 million head (1.9%) from last year. The beef cow herd dropped 716,000 head (2.0%) to 28.233 million head. The 2023 calf crop was estimated at 33.593 million head, down 847,000 head (2.5%) from the previous year. The total cattle herd was the smallest since 1951 and last year’s calf crop was the smallest in 82 years.

Of note, USDA revised the Jan. 1, 2023, cattle population down 433,000, with 411,000 head coming out of the heifer category, specifically replacement heifers. USDA cut beef replacement heifers 233,000 head and dairy replacements 263,000 head, while “other heifers” headed to feedlots was revised up by 85,900 head.

The number of beef heifers expected to calve in 2024 dropped 58,000 head (1.9%) and total beef replacement heifers declined 72,000 head (1.5%). That was the smallest number of heifers held back for breeding since 2011, largely because so many were moved into feedlots. Combined with the smaller beef cow inventory, the 2024 calf crop will continue to shrink.

The milk cow herd at 9.357 million head declined 41,000 head (0.4%) from year-ago and milk replacement heifers dropped 15,000 head (0.4%).

Based on the cow herd size and number of heifers being held back for breeding, the total U.S. cattle herd is likely to decline roughly another 1 million head as of Jan. 1, 2025.

Compared to pre-report expectations, the data was neutral. But the underlying data is bullish as the U.S. cattle herd contracted further — and will continue to do so.