Author: Josh Maples

Tighter cow numbers over the past few years have led to smaller calf crops and fewer cattle to sell. According to data from the USDA-AMS National Feeder and Stocker Cattle Summary, the number of feeder and stocker cattle sold during the first 14 weeks of 2025 totaled 3.72 million head which was 9.5 percent below the number sold during the same period in 2024. Receipts so far in 2025 are down 9 percent year to date when compared to the 4-year average from 2020-2023. 

2018 was the peak in sales for the current cattle cycle as shown in the chart above. The 2024 total was 11 percent below 2018 and 4 percent below 2023. It is still early in 2025, but the current trend, and general lower cattle supply, suggest that 2025 sales will be lower again. This dataset includes auction, direct, and video/internet sales reported to USDA. It is not a comprehensive dataset as it does not capture all feeder and stocker cattle transactions, and the report notes that “receipts vary depending on the number of auctions reported.” However, given the similar methodology over time, comparisons are useful in comparing market dynamics to previous years.  

The report also gives information about the mix of steers and heifers. It is interesting to compare 2024-2025 to 2014-2015 in the context of heard expansion. As shown in the chart below, the percentage of heifers has been higher in 2024 and 2025 than it was in 2014 and 2015. When herd expansion begins, we’d expect the share of heifers in the feeder cattle mix to decline as producers begin to retain more heifers. This is another indicator that producers have not yet started retaining heifers in the same way that they were in 2014-2015 when that herd expansion period began. 

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Maples, Josh. “2025 National Feeder and Stocker Receipts and Heifer Percentage.” Southern Ag Today 5(16.2). April 15, 2025. Permalink

With all the talk about the number of cows and cattle in the U.S., when herd rebuilding might begin, tariffs, and recent record high prices it seems like a good time to re-visit cattle numbers and beef production from a longer-term view.  

Things We Know

The cattle industry remains a cyclical industry.  The cattle cycle is driven by biology and economics with events like droughts interrupting the cycle.  Beef production is cyclical also.  It follows from the cow herd expansion or contraction, the number of calves, and the weights of those finished cattle.  

The beef cow inventory has declined since its peak in 1975 at 45.7 million head.  Each peak in the number of cows has been smaller than the previous cyclical peak over that time.  The cow herd declined, as part of the current cycle, to 27.9 million head in 2025, the fewest since 1961.  While the herd has moved cyclically up and down every 10-12 years, the overall trend in beef cows is declining over time.

In contrast to cow numbers, beef production has been trending higher since 1975.  Following the 1975 peak in cows, beef production peaked in 1976 at 25.7 billion pounds. This remained the high mark until 1999 when beef production hit 26.4 billion pounds. Production has since exceeded the 1974 level in all but 4 years, despite the lower cow numbers.  Genetics and feeding improvements have led fed beef production to have an upward trend even with fewer head. The key is the trend in cattle weights.  The U.S. has a long-term trend toward heavier weights driven by economics, genetics, technology, cattle size, feeding, and nutrition. 

What Does This Suggest?

The industry has experienced tremendous growth through productivity gains that show up in animal weights.  The cattle cycle shows up in beef production as it does in herd numbers.  Declining cattle numbers reduces beef production, mitigated by heavier weights and cow culling, and supports higher prices leading to herd expansion.  A growing cattle herd increases beef production by even more as weights increase. 

This discussion leads to questions to consider.  Can we get back to cattle numbers of the past? This would imply more ranchers, more feedlots, and more industry infrastructure? Or will the next cycle continue to the trend of a smaller peak than the most recent cyclical peak in 2019?  Recent record high prices have not quite yet led to herd expansion – but when that expansion comes, can the herd eclipse the 2019 total of 31.6 million head and deliver profitable balance sheets to continue rebuilding?  

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Maples, Josh, and David Anderson. “Cattle Inventory and Beef Production.” Southern Ag Today 5(15.2). April 8, 2025. Permalink

The February Cattle on Feed report was released this past Friday afternoon and reported 11.7 million head of cattle in feedlots on February 1^st. This was a 0.7 percent decrease from February 1, 2024. Marketings were up 1.4 percent year-over-year. There were no big surprises in the report relative to pre-report expectations, but there were some interesting points in the report. 

Placements of cattle into feedlots during January were up 1.7 percent above January 2024. Weather and winter storms delayed January 2024 placements, so the increase shown for 2025 is partially driven by a lower 2024 number. In 2024, placements were higher in February than they were in January which was the first time that had occurred since 1996. We have not seen those same challenges so far in 2025, but February placements are likely to be impacted by the lingering impacts of the Mexico cattle import ban. 

A regional look at the data implies an impact of the Mexico import ban on January placements. January 2025 placements of cattle into feedlots in Texas were 50,000 head lower than a year ago which is a 14.5 percent decrease. This was offset by a 60,000 head (15.4 percent) increase in Kansas and a 30,000 head (5.9 percent) increase in Nebraska during January.  

The largest increase in placements was in the 700-799 pound weight range which were up 30,000 head (6.3 percent) from a year ago. Placements were up across all weight classes in Nebraska and Kansas and lower across all weight classes in Texas. Placements of cattle into Texas feedlots weighing less than 699 pounds were down 35,000 head during January compared to a year ago. 

The data mentioned above comes from feedlots with at least 1,000 head capacity. However, another interesting part of the February report is the detail about the distribution of cattle across feedlot sizes. There are 2,105 feedlots with at least 1,000 head feeding capacity. These feedlots housed 83 percent of cattle on feed as of January 1, 2025. The remaining 17 percent of cattle on feed were located across the 24,000 feedlots with a capacity of less than 1,000 head. Of the 1,000+ capacity feedlots, there were 80 that have a capacity of 50,000 head or more, and these were home to 35 percent of the total U.S. cattle on feed on January 1.

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Maples, Josh. “February Cattle on Feed.” Southern Ag Today 5(9.2). February 25, 2025. Permalink

In 2024, cattle markets remained strong, driven by declining cattle numbers—a trend consistent with expectations outlined at the start of the year. The ongoing cattle cycle began in 2014 and saw beef cow inventories peak in 2019 at 31.69 million head. Since then, inventories have declined at an annual rate of 2.3%. 

Cattle and calf prices continue their upward trajectory, ending the year on a high note. In the Southern Plains, prices for 500-600 pound steers have increased by approximately $40 per CWT from early October to mid-December. Contributing factors include recent rainfall in the region and a reduced number of calves, which have collectively helped to elevate calf prices. Additionally, the current import restrictions on feeder cattle from Mexico are likely providing some further support to prices, given that December is typically a peak month for imports. 

We also have a strong fed cattle market to finish the year.  Fed steer prices in the Southern Plains reached $195 in mid-December. Carcass weights remain very high compared to history. Steer dressed weights are near 960 pounds. Lower corn prices are supporting longer feeding periods, but there are typically seasonal declines in fed weights. It will be very interesting to watch cattle weights as 2025 begins.

2025 will begin as another year on the heels of herd contraction in the previous year. The USDA’s January 2025 Cattle Inventory Report is expected to confirm that cattle numbers did indeed decline in 2024. Weekly slaughter data from USDA support this projection. Year-to-date beef cow slaughter is down by 18%, but the implied cull rate—calculated as slaughter divided by inventories—remains at 10.2% for 2024, well above the that would indicate herd expansion. Heifer slaughter data also shows no signs of herd expansion. Year-to-date heifer slaughter is down 1.1%, with no evidence of heifer retention occurring at a rate sufficient to signal herd rebuilding.

Cattle market fundamentals at the close of 2024 offer plenty of bullish signals for 2025. Many producers remember the high prices in 2014-2015 as a cautionary tale of how quickly prices can come down after a run up. However, the current fundamentals are quite different than they were in 2015. By year two of the 2014-2015 high price environment, it was clear that herd expansion was occurring. Currently, there are no clear signs to suggest larger calf supplies anytime soon. While prices are high, they have not yet hit levels to persuade producers to expand. 2024 prices hit record levels as shown in the chart above. However, after adjusting for inflation using 2000 as the base year, the purchasing power from the 2024 producer revenues was still below 2014-2015. It could very well be that feeder cattle prices have not yet peaked and the market is beginning 2025 with more optimism. 

Happy New Year!

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Maples, Josh, and James Mitchell. “2024 Beef Cattle Market Review.” Southern Ag Today 4(53.2). December 31, 2024. Permalink

The January 2025 feeder cattle futures contract dropped roughly $25 per CWT from mid-July to mid-August. But, since early September, futures contract prices have rebounded about $15 per CWT. Points on the solid maroon line in the chart are the end of day futures contract prices from last Friday for each feeder cattle futures contract month. Points on the dotted black line are end of day prices back on September 6^th, after the big decline.  

The chart nicely illustrates seasonality within the futures market. Auction prices for 750-pound feeder cattle are typically lowest in the spring months when those calves are yearlings.  Futures prices reflect expectations of seasonal patterns too, but there are a few steps to thinking through the impact. 
 
First, it’s important to remember that feeder cattle futures prices are the “market’s” expectation of what the CME Feeder Cattle Index will be at the end of the contract month. The “market” is made of buyers and sellers trading the futures contract. The feeder cattle index is calculated from auction prices for 700-899 pound steers collected by USDA-AMS for a 12-state region in the middle of the U.S. (there are no states east of the Mississippi River included in the index). It is a 7-day rolling weighted average, so today’s index value is a weighted average of the auction prices over the past week. Most auctions only operate one day per week so the 7-day average catches sales during a week’s period.
 
How does seasonality fit into this? If prices are typically expected to be lower during certain months (i.e. seasonality), then the futures contract prices for those months will likely be lower because traders are “baking-in” the seasonality expectations. The chart above is a good example. Since these prices reflect 700-899 pound feeder steers, the market (futures traders) is expecting auction prices (the CME index) to be lower during the spring months before rising seasonally as summer approaches.

This exercise illustrates the importance of understanding how the value of your cattle correlates to futures market prices for risk management or for forecasting prices. Your cattle may not be 800-pound steers sold in that 12-state region. But if you know your cattle are usually $10 above or $10 below the futures market at sales time, then then you can still use the futures market’s expectations to forecast the expected value of your cattle and to participate in price risk management tools.

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Maples, Josh. “Feeder Cattle Futures Prices.” Southern Ag Today 4(46.2). November 12, 2024. Permalink