Category: Livestock Marketing

The number of dairy cows in the U.S. declined to 9.4 million head in October, 14,000 head fewer than in October 2020.  Milk production per cow and milk production fell below last year, as well.  All three statistics are a sharp departure from the Spring when the number of cows peaked at 9.5 million head.  

Four states in the South are included in monthly NASS reports on milk cows, production per cow, and milk production: Florida, Georgia, Virginia, and Texas.  Fewer cows were reported in Florida (-7,000 head) and Virginia (-3,000 head) in October compared to October 2020.  Georgia reported 1,000 more dairy cows.  Texas, where milk production has largely moved to the panhandle, reported 22,000 more cows.  Following cows, October milk production was lower in Florida and Virginia and higher in Georgia and Texas.

DMC payments were triggered last month for the tenth straight month.  While all milk prices have increased in the South, prices elsewhere are below a year ago.  Feed costs continue to be high, leading to continued DMC payments.  Reduced milk production is likely to result in some higher milk prices in coming months increasing milk over feed cost margins but rising non-feed costs will keep the pressure on margins.  

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Anderson, David. “Fewer Dairy Cows in Parts of the South.” Southern Ag Today 1(50.2). December 7, 2021. Permalink

Beef cow slaughter has been higher than year-ago levels for most weeks in 2021. National beef cow slaughter is up about 10 percent (or about 6,000 head weekly average) since July over the same period of 2020. In the southeast reporting region which includes AL, FL, GA, KY, MS, NC, SC & TN, beef cow slaughter has been about 25 percent higher since July 2021 than it was during the same period of 2020. That is equivalent to an additional 2,000 head each week on average. This region accounts for about 15 percent of national beef cow slaughter. There has been some additional cow processing capacity brought online in the southeast in 2021 which helps explain the weekly increase in slaughter. But where are the cows coming from? Are producers in the southeast culling cows deeper than previously expected? Weekly auction receipts shed some light on these questions.

Combined weekly auction receipts for slaughter cattle (reported as both cows and bulls) from GA, KY, and MS are up 3 percent since July compared 2020. That 3 percent increase equals an additional 128 head weekly average. The data is messy, and I don’t have the data for the other 5 states in the region, but the receipts don’t suggest enough of an increase in the number of cows being culled in the southeast to support the big increase in beef cow slaughter in the region. It seems likely that a good portion of the increase in slaughter are cows coming from other regions. Backhauling cows is likely a contributor when calves or feeder cattle are trucked from the southeast to other regions and cull cows come back. The January Cattle Inventory report will tell a more complete story of the changes in cows in each state. 

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Maples, Josh. “Huge Cow Culling in Southeast? Not So Fast, My Friend!” Southern Ag Today 1(49.2). November 30, 2021. Permalink

USDA’s November Cattle on Feed report comes out Friday, November 19^th.  The report is expected to indicate that about 3.6 percent more cattle were placed on feed in October than last October.  Placements usually increase in the Fall to a peak in October.  The South is a major calf producing region supplying feeder cattle to feedlots throughout cattle feeding country.  On average, over the last few years, 73,726 cattle have entered Texas from Southern states in October.  That data is from the Texas Animal Health Commission and represents non-breeding cattle in-shipments to the state with a veterinary certificate.  It does not mean that all those cattle went directly to feedyards and it is likely an undercount of all cattle coming into Texas.  Drought in some parts of the country and higher fed cattle prices are supporting placements.

Feedyard marketings are expected to be below last October by about 4.2 percent but, the decline in marketings is due to one less working, or slaughter, day in October 2021 versus October 2020.  Daily average marketings should be about the same as a year ago.  The combination of marketings and placements leaves the number of cattle on feed on November 1^st at 99.9 percent of last year.  

A lot of factors are at work in determining Southern calf prices, like higher fuel costs for trucking, higher fertilizer prices, and higher hay prices. Higher fed cattle prices are boosting the demand for calves and supporting prices.

Anderson, David. “More Cattle Heading to Feedlots.” Southern Ag Today 1(47.2). November 16, 2021. Permalink

Following their normal Fall decline, calf prices across the country, including the South have bounced higher.  In the last two weeks 5-600 pound calf prices in Georgia have increased from about $139 to $146 per cwt.  That calf price increase is roughly in line with the average price increase over the 2015-2019 period.  Lighter, 4-500 pound calves in Georgia, have seen little price increase, in contrast to sharply higher prices for lighter calves in Texas.  Heavier, 7-800 pound feeder steers have increased about $10 per cwt to $130 over the last two weeks.

A couple of factors are working to increase calf prices.  The first is supply related in that the Fall run of calves is over, effectively reducing supplies on the market.  The second is rising fed cattle prices.  Fed cattle prices crossed $130 per cwt last week after a number of weeks around $124.  Higher feed costs are working against these price increasing factors.  Corn prices in the Southern Plains have increased from about $5.85 per bushel to $6.11 in the last couple of weeks.  

Calf prices do tend to decline by year end, on average, before rallying into the next Spring.  The smaller cow herd suggests some tighter supplies of calves next year.  Rising fed cattle prices would also pull calf prices higher.  

Anderson, David. “Calf Prices on the Rise.” Southern Ag Today 1(46.2). November 9, 2021. Permalink

It’s that time of year where our attention turns to turkeys.  While the South is not normally thought of as a major turkey producing region, we are major eaters.  But, Arkansas and North Carolina are the second and third largest turkey producing states, respectively, according to NASS, USDA data. 

Weekly turkey production is down about 5.5 percent for the year compared to last year.  But, as Thanksgiving has approached the production gap has closed a little, with production only trailing last year by 2 percent over the last 2 months.  Production, estimated to total 5.7 billion pounds is the smallest since 2015.  Struggling turkey demand over the last few years and higher feed costs over the last year have contributed to falling production.  Per capita consumption at 15.34 pounds in 2021 will be the smallest since 1987.  

Tighter supplies have led to higher prices.  While USDA no longer reports retail turkey prices, the wholesale market provides an indication of prices for the holidays. Wholesale prices for frozen 8-16 pound hens and 16-24 pounds toms are 17 percent higher than those last year.  So, grocery stores will feel the pressure of higher prices and figuring out how much to pass on to their customers.  Turkeys are often used to sell the whole basket of Thanksgiving dinner items.  It appears that retail store featuring is starting to pick up, but price specials are lagging behind last year.  

While stores aren’t likely to run out, it may pay to shop early this year, especially if there is a specific weight, brand, or fresh vs frozen bird you like the best.    

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Anderson, David. “It’s Turkey Time! Gobble Gobble!” Southern Ag Today 1(45.2). November 2, 2021. Permalink