Beef cowherd expansion continues across much of the U.S. The drought of 2011 and 2012 impacted cow numbers nationally as well across the southern plains. Cow herd expansion began this past year according to the U.S. Department of Agriculture’s cattle inventory report released in January. The spring rains have helped the drought conditions substantially, so herd expansion is on track to continue this year. Oklahoma State University Extension Livestock Market Economist Dr. Derrell Peel said increasing herd numbers will be gradual rebuilding process.
It’s been about 20 years since the U.S. experienced herd expansion like this. Over a four year period, Peel said the U.S. averaged about a two percent herd increase annually. It can go higher than that one year, but it’s hard to sustain a rate much higher than that. He was surprised to see a two percent increase in the beef cow herd in 2014 and he wouldn't be surprised that we could see a three percent gain this year, but doesn’t think the industry can sustain a three percent increase over multiple years. Even with increases of two percent annually, he said herd expansion will continue for another two to three years to get back to a herd level that is being demanded by the market.
The commodity market continues to give producers the green light in encouraging herd expansion in needing more beef in the pipeline. That means more calves and more cows are needed. Peel isn’t sure if the market will move past the peak calf prices seen in the fall of 2014, but prices will remain near record levels through 2015 and through most of 2016. He looks for prices to remain relatively strong until 2018 and possibly longer.
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