From Rabobank News
Herd expansion is underway in the United States. Rabobank is predicting about three million cows will be added over the next three to five years. Rabobank livestock industry economist Don Close said the market place is offering incentives to the individual cattle producer to rebuild their cattle herd.
“The big incentive for repopulating cow numbers has been the $500 a head plus return for cow-calf operations last year and again this year,” Close said. “And no way do we expect those kind of returns to stay in place, but we still think there’s going to be a multi-year run of very solid returns.”
The Southern Plains region continues to recover from the severe drought in 2011, 2012 and 2013. Close said a lot of producers wanted to repopulate and grow their cattle herd earlier, but didn’t have the cooperation from Mother Nature until this year to make that happen. He said the combination of strong economic returns and the much improved weather conditions are finally allowing producers the ability to move forward and grow their herd.
Now the beef industry is trying to determine how many beef cows will be enough. That’s something Rabobank been looked at with their production models. In looking out to the year 2020, Close said their target is 33 to 34 million head. That would comparable to the U.S. beef cattle inventory back in 2007 and 2008.
“We think that will be a head count that will certainly provide the supplier network to our cattle feeding network as well as our beef processing sector,” Close said.
Click here to see more...