The severe drought has drawn down the U.S. beef cattle herd. As the Southern Plains and other states have received moisture, drought recovery has begun and herd expansion has been able to take place. That was evident in the January first 2015 U.S. Department of Agriculture’s Cattle Inventory report as well as the midyear report just released in July. Rabobank livestock industry economist Don Close doesn’t remember a time where there has been so much media attention over USDA's midyear cattle inventory report. Close said Rabobank has taken a longer term view of the situation, which is based on production models. He said they are looking out to the year 2020 to predict where the U.S. beef cow herd will be. Close is predicting about three million cows will be added over the next three to five years.
In looking at drought and demand for land resources, those cows are more likely to be added in some areas over others. Close said growth will be limited in the whole west coast area because of the ongoing drought as well as the difficulties with Bureau of Land Management. He said that will probably cap growth for the west coast region.
Rabobank also scrutinized the whole southeast region. Close said with the escalating population growth along the coastal states, the changing social norm and expectations, he said that will curb the growth rate in the southeast. So, that leaves the central plains as the most likely place to expand the U.S. beef cow herd.
“Certainly with the recovery and the weather that we’ve had in the Central Plains - Texas, Oklahoma, New Mexico, Kansas, we’re looking for a big share of that natural growth and early growth to occur in those central cow-calf states,” Close said.
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