Category: Livestock Marketing

  • Calf Prices Jump

    Calf Prices Jump

    Calf prices bounced around in the first month of the year, but they rebounded significantly higher in the last couple of weeks.  Higher fed cattle prices, hitting $160 per cwt last week, and tighter supplies of calves and feeders are fueling this price run.  

    In the Southern Plains, 5-600 pound steers have increased from $203 per cwt to $214 in the last two weeks.  During the same period, the same weight calves in Georgia bounced from $181 to $188 per cwt.  Heavier feeders, (7-800 pounds) saw more modest gains in the Southern Plains, up about $4 per cwt to $182.  In Georgia, those heavier calves actually dropped about $2 per cwt to $163.  Calf prices tend to be lower the further South and East from feedlots in the Plains and Corn Belt.  Prices in both the Plains and Georgia were about $26 per cwt higher than last year.

    Fed cattle prices hit $160 in several markets last week.  Higher prices for fed cattle certainly boosted calf prices.  Fewer available feeder cattle are also working to boost prices.  Calculating feeder cattle supplies from information in USDA’s cattle inventory report indicated that 25.3 million head were outside of feedlots, about 270,000 head fewer than the prior year.  That is the fewest since the 24.6 million available in 2015.  

    Tight supplies of calves will keep prices higher than a year ago.  But, there is likely to be some volatility as feed prices and demand for cattle move throughout the year.  Prices for lighter weight calves and feeders tend to increase seasonally into March and April.  Heavier feeders are often pressured by winter pasture cattle coming to market in the Spring.

    Author: David Anderson

    Professor and Extension Economist Livestock and Food Products Marketing, Dairy, Policy


    Anderson, David. “Calf Prices Jump.” Southern Ag Today 3(7.2). February 14, 2023. Permalink

  • Observations on the Cattle Report in the South

    Observations on the Cattle Report in the South

    Plenty has been written on USDA’s Cattle inventory report released on January 31st.  In today’s writeup we are going to focus on some observations by a few of our Southern Ag Today livestock economists from around the South.

    Andrew Griffith, University of Tennessee.  Despite the bullishness of the cattle inventory report, beef cattle herd expansion will not be able to begin until the fall calf crop is ready to hit the ground, and it will only start if ample supplies of hay are harvested in 2023 and fall grazing looks promising. This means most of the heifers in the 2022 calf crop will be entering feedlots. It will be the 2023 calf crop where there is opportunity for heifers to be retained for beef cow replacements. The issue with the 2023 calf crop is that it will likely be 900,000 head smaller than the 2022 calf crop, which means 450,000 fewer heifers to choose from. The majority of the room for expansion will be in the Plains from Texas to Nebraska and the Mid-South (i.e. Kentucky, Tennessee).

    Kenny Burdine, University of Kentucky.  The Kentucky beef cow herd was estimated to be down by 7% year-over-year. I have to go back to 1967 to find a beef cow inventory that small for the Commonwealth – over 50 years!  After many years of decreasing dairy cow inventory, Kentucky saw an increase in dairy cow numbers during 2022. This is significant and may speak to a reversal of that long-run trend.

    On a little less Kentucky oriented note, monthly on-feed numbers finally moved below year-ago levels this fall. The 4% decrease from 2022 levels in this report really speaks to lower 2023 beef production. This will be our first year-over-year decrease in beef production since 2015. Last year was not a good year for wheat grazing in the Southern Plains due to dry weather and high wheat prices. The fact that the January 2023 Inventory report showed an additional 5% decrease in the number of cattle grazing on small grains in that region is significant. Winter wheat grazing represents a significant opportunity for spring born calves that move through markets in late fall / early winter and Southern calf markets feel these impacts when winter grazing demand is not there.

    Max Runge and Ken Kelley, Auburn University.  Alabama’s beef cow herd for January 1, 2023 was virtually unchanged from the inventory of January 2022. There was a one percent increase for beef cows that have calved, but when combined with a smaller number of heifers over 500 lbs. held as beef replacement heifers and a smaller number of milk cows that have calved (-33% YOY), the difference in reproductive females only equates to a 5,000 head increase in 2023- or less than 1%. The number of steers and bull over 500 lbs. remained the same with the only difference being the percentage of steers versus bulls. In 2022, there were 4,000 more steers than bulls but in 2023, bulls totaled 4,000 head more than steers. Calves less than 500 lbs., totaled 10,000 more in 2023. Overall, the beef cattle numbers were less than ½ percent less in 2023.

    David Anderson, Texas A&M University.  The number of beef cows in Texas declined by 125,000 head or, 2.8 percent, to 4.3 million head.  That was the fewest since 2016.  It is interesting to note that USDA revised the 2022 beef cow numbers down 50,000 head.  That decline might have been a little smaller than expected given the large increase in beef cow slaughter in the region which includes Texas, New Mexico, Oklahoma, Arkansas, and Louisiana.  Those states saw a 325,000 head decline in beef cow inventory, closer to in line with the increase in the regional beef cow slaughter data.  Heifers held for beef cow replacement were down 9.9 percent, well more than the beef cows.  The ratio of heifers to beef cows is consistent with a cow herd continuing to decline.  Also of note is the Texas dairy herd.  Dairy cows increased another 25,000 head to 650,000 head, the most since 1959 and speaks to the continued rapid growth in the Texas Panhandle.  The growth in beef on dairy breeding will continue to expand a steady new supply of feeder cattle to High Plains feeders.

    University of Kentucky Ag Logo

  • Record Egg Prices Driven by Supply Disruptions

    Record Egg Prices Driven by Supply Disruptions

    Prices at the grocery store are higher for nearly everything, but one staple food item, in particular, is likely a key driver of recent sticker shock for consumers. Egg prices during the holiday season were up more than double over the same period in 2021. Retail egg prices averaged $4.25 per dozen in December 2022, a record high. This compares to $1.79 per dozen in December 2021.

    The main culprit of the higher prices is a supply disruption at a time when consumers have a strong demand for eggs. Highly Pathogenic Avian Influenza (HPAI), often called the bird flu, is an important concern each year, but was especially problematic in the U.S. during 2022. USDA reports that HPAI was detected in 307 commercial flocks in 2022. HPAI is very contagious between birds, so strict containment protocols including depopulation of infected flocks are used to prevent additional spread to other flocks. 

    USDA estimates that approximately 57 million birds in the U.S. were affected by HPAI in 2022. Of this total, nearly 40 million were egg laying hens lost to HPAI between February and December 2022. There were 320 to 335 million hens laying eggs each month in 2021 but that total has been in the 299 to 310 million hen range between April to October 2022. Fewer laying hens has led to fewer eggs produced and tighter supplies for eggs consumers.  Egg production has trended down over the last couple of years due to high feed costs, rising other production costs, and the turmoil of the pandemic on profits.

    On the demand side, the holiday season is peak season for egg consumption. According to the first weekly USDA “Egg Markets Overview” of 2023, an estimated 11.4 eggs during the Thanksgiving holiday and 8.6 eggs during Christmas were used per household. The Christmas estimate is 1.6 eggs higher than Christmas 2021. Even at high prices, U.S. consumers still purchased a lot of eggs over the holidays. Strong demand at a time when supplies are tighter drove egg prices higher.  

    The good news is that egg prices are expected to moderate in the months ahead. Consumer demand for eggs will not be at holiday levels, except for Easter egg hunts, and egg producers will continue to try to recover from the supply disruptions. HPAI concerns will continue into 2023 and future impacts could affect supplies this year, too. But current USDA forecasts are for 2023 egg prices to fall back to more normal levels as the supply and demand balance improves.    

    Mississippi state university logo

    Author: Josh Maples

    Assistant Professor, Livestock, Production Economics, Commodity Marketing

    Mississippi State University


    Maples, Josh. “Record Egg Prices Driven by Supply Disruptions.” Southern Ag Today 3(5.2). January 31, 2023. Permalink

    Image credit to Julia Filrovska

  • The Interesting Part of the Cattle on Feed Report

    The Interesting Part of the Cattle on Feed Report

    I think the most interesting number in USDA’s latest Cattle on Feed report (released Friday January 20th) was the quarterly number of heifers on feed.  The report indicated 4.65 million heifers were on feed on January 1, down 25,000 head from January 1, 2022.  The quarterly data breaks out the number of heifers and steers on feed and is released in January, April, July, and October.  When comparing to the same quarter of the prior year, it was the first quarter since July 1, 2021 that registered a decline in the number of heifers in feedlots.  That slightly fewer heifers are on feed than last year does not indicate a movement toward herd rebuilding, but it may indicate that there are fewer heifers to place as total cattle numbers decline.  Compared to January 1, 2022, steers on feed were down 4.5 percent compared to the 0.5 percent decline in heifers.  

    Of the total cattle inventory on feed, 39.8 percent were heifers, the largest percentage since 2001.  Heifers as a percent of cattle on feed exceeded 40 percent in 2000 and 2001 which was another period of cow herd contraction.  This quarterly data began in 1996.

    The headline numbers were not much different than expected.  Marketings were down 6.1 percent, placements down 8 percent, and total cattle on feed were down 2.9 percent.  

    Author: David Anderson

    Professor and Extension Economist Livestock and Food Products Marketing, Dairy, Policy


    Anderson, David. “The Interesting Part of the Cattle on Feed Report.Southern Ag Today 3(4.2). January 24, 2023. Permalink

  • Fewer Cattle on Feed Expected

    Fewer Cattle on Feed Expected

    Friday brings USDA’s first cattle on feed report of the year and will lead us to the cattle inventory report to be released on January 31st.  This article takes a look at some expectations for the cattle on feed report.

    All three categories, December marketings, placements, and the January 1 number of cattle on feed are expected to be smaller than last year.  Feedlot marketings are expected to be about 5.5 percent smaller than last year.  Marketings are highly influenced by the number of slaughter days in the month.  Slaughter days are the number of days in the month minus holidays and weekend days.  December 2022 had the same number of days, 21, as December 2021.  That implies a lower daily rate of marketings.  It’s likely that they were reduced by some winter storms and falling packer margins.

    Feedlot placements, or the number of cattle placed into feedlots, in December is expected to be about 10 percent smaller than last December.  Several sets of data are relevant to the number of cattle going on feed. USDA reports weekly data on feeder receipts, or sales, at auction markets, internet and video sales, and direct sales.  It is not a complete accounting of all sales each week.  It was 36 percent smaller than December 2021.  The number of feeder cattle reported on the CME index was about 10.5 percent smaller than December 2021.  About the same number of feeder cattle were imported from Mexico as last year.

    Fewer cattle marketings and placements leaves about 3.5 percent fewer cattle on feed to start this year compared to last year.  Fewer cattle on feed would continue the trend of shrinking numbers.  It will lead to less beef production and likely higher cattle prices this year.  One of the interesting numbers to look at in this report will be the estimate of the number of heifers on feed as of January 1.  Heifers have been a growing percent of all cattle on feed as the cow herd has been reduced.  

    Author: David Anderson

    Professor and Extension Economist Livestock and Food Products Marketing, Dairy, Policy


    Anderson, David. “Fewer Cattle on Feed Expected.” Southern Ag Today 3(3.2). January 17, 2023. Permalink