According to the report, “All the cattle and calves in the United States, as of January 1, totaled 89.3 million head.” This is the lowest January 1 cattle and calve inventory since 1952.
Northern Ag Network reports that this is “2 percent below the 90.8 Million on January 1 last year.” According to Bloomberg.com, inventory fell to the lowest in 60 years “after a drought in the South scorched pastures, prompting ranchers to shrink herds.”
Chad Henderson, a market analyst at Prime Agricultural Consultants, Inc., stated in a phone interview, “We had one of the biggest droughts in Texas this past year.” “Guys have been ripping up pasture and planting crops. It’ll take years for this thing to build back up,” said Henderson.
The USDA also reported that the total number of calves born in 2011 fell 1.1 percent. Ron Plain, live economist at the University of Missouri at Columbia, said “Fewer calves being born means ultimately fewer cattle will be slaughtered.”
“That means the tight beef supply is going to get tighter as we go through 2013 and 2014,” said Plain.
In a January 25 report, the USDA claimed that “consumers may pay as much as 5 percent more for beef this year, the biggest increase in all the food groups except for seafood.”
Drovers Cattle Network reported that a consistent raise in beef prices could ultimately jeopardize domestic and international demand for U.S. beef, ending up with a “lost market share to other proteins or other beef exporters.”