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U.S. Cattle Inventory hits 73-Year low - Impact on Ag Markets

By Farms.com

The U.S. cattle inventory as of January 1, 2024, is at its smallest in 73 years, with 87.2 million head, down 2% from the previous year. The calf crop is also at its lowest since 1948, with 33.6 million head. Despite historically low cattle numbers, the supply of cattle on feed remains high. Beef production in 2023 decreased by 2% but had record-high dressed weights. The decrease in inventory, coupled with higher weights, has influenced the forecast for 2024 commercial beef production. 

Implications and Analysis: 

  • Market Dynamics: 

  • The low cattle inventory is considered for the market, setting the tone for cattle markets in 2024. 

  • Despite the low inventory, there is a curiously high supply of cattle on feed, likely maintaining stable beef prices in the short term. 

  • Cattle Cycle Contraction: 

  • The decline in replacement heifers is slowing, possibly indicating a slowing contraction phase in the cattle cycle. 

  • Production and Prices: 

  • Beef production in December 2023 was below the previous year, but higher weights contributed to a record-high average. This, coupled with the smaller calf crop, has led to forecasts of increased beef prices in 2024 and 2025. 

  • Supply Chain Challenges: 

  • The decline in the calf crop and replacement heifers may result in a shortage of cattle in the supply chain, potentially leading to higher prices in the latter part of 2024. 

  • Domestic Demand: 

  • Despite higher prices, domestic consumer demand for beef remains strong. However, there is an expectation of a decline in consumer willingness to pay, potentially impacting consumption. 

  • Global Demand: 

  • Global demand for U.S. beef faced challenges in the final quarter of 2023, but demand from key Asian trade partners remains robust. Economic conditions and increased Australian beef production could affect global demand. 

  • Input Costs: 

  • Improved drought conditions due to El Niño have positively influenced feed costs, but higher cattle prices and increased interest expenses pose challenges for farmers looking to expand their herds. 

  • Barriers to Herd Expansion: 

  • The Federal Reserve's decision to maintain higher interest rates may hinder farmers' ability to borrow money for expansion, potentially slowing down herd recovery in the coming years. 

The overall outlook for the U.S. cattle industry in 2024 suggests both opportunities and challenges. While low cattle numbers may provide profitability for cattle businesses, a smaller calf crop and potential supply chain challenges could lead to record beef prices for consumers. The ability of consumers to withstand higher prices will play a crucial role in determining the industry's trajectory in the coming year. 


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The 15-Year Bet Behind Every New Variety

Video: The 15-Year Bet Behind Every New Variety!



Canada is trying to decide how much agricultural research capacity it can afford to lose. Brian Rossnagel believes the better question is whether the country can afford to rebuild it.

The longtime barley and oat breeder makes the case with a simple fact about his profession: the consequences of today’s decisions may not become visible for 10 or 15 years.

“Pick the right parents. That’s the biggest thing,” Rossnagel says. “If you pick the wrong parents, you’re not going to get anywhere—and you don’t know that until 10 years, 15 years later.”

That warning carries particular weight as Agriculture and Agri-Food Canada moves to reduce spending and streamline parts of its science operations. The department’s 2026–27 plan anticipates the loss of approximately 665 positions by 2028–29 and says some research will be reduced where capacity exists in academia or industry. AAFC says the changes will make its science operations more cost-effective over the long term.

For Canada’s seed industry, Rossnagel’s career illustrates what is at stake.

This fall, the retired University of Saskatchewan breeder will be inducted into the Canadian Agricultural Hall of Fame. During his 35-year career at the Crop Development Centre, he helped develop more than 100 barley and oat varieties, including CDC Austenson—one of Western Canada’s most widely grown feed barleys. His induction recognizes not only those varieties, but the collaboration and research system that made them possible.

Rossnagel is quick to emphasize that none of it was the work of one person.

“The first thing I thought about was all the other people who contributed to whatever success I and my program had over the years,” he says. “We know that it’s not an individual who does this. It’s a group—a team.”

That team extends well beyond the breeder whose name appears beside a variety. It includes technicians, pathologists, quality specialists, statisticians, regional testing sites, seed growers and industry partners. It also includes the breeders who came before and those who will carry the germplasm forward.

CDC Fraser barley, for example, moved through three breeding careers. Its parents came from Brian Harvey’s program. Rossnagel advanced the material after Harvey retired, and Aaron Beattie later guided it through registration and release.

That kind of handoff is normal in plant breeding. The person who makes the original cross may never see the resulting variety reach farmers.

It also explains why lost research capacity cannot simply be switched back on when budgets improve.

“If you shut it off, it’s very, very difficult—and particularly costly—to start it up again,” Rossnagel says. “If you have to start from scratch, it’s going to be at least 10 years before anybody notices whether you’re getting anything done or not.”

The concern is not simply how many experimental lines Canada can process. Modern equipment, statistical tools and genetic technologies allow today’s breeding programs to evaluate tens of thousands of lines—far more than Rossnagel could handle when he entered the field in the early 1970s.

But efficiency and automation do not generate every idea.

“If you pare back down, and instead of having six or seven individual scientists concentrating on wheat breeding, you go down and say three people could handle all this, well, that’s half the ideas gone,” he says. “Particularly if you happen to lose the three people who had the really neat and innovative ideas, boy, that’s a problem.”

It is a timely distinction for Canadian agriculture. Consolidating programs may preserve the volume of material moving through a system, at least initially. It may not preserve the diversity of thinking, regional knowledge or willingness to pursue unconventional crosses.

That regional knowledge matters because Canadian agriculture is not one uniform production environment. A variety suited to southern Alberta may face different disease, moisture and maturity pressures than one grown in Manitoba, Ontario or Atlantic Canada.

“Agriculture is applied biology,” Rossnagel says. “Biology, all around the Earth, moves from the poles to the equator. It does not move from Newfoundland to B.C. like politics do.”