Heifer and beef cow slaughter levels have surged over the last year. USDA-NASS Livestock Slaughter report places total heifer slaughter under federal inspection up 7.3% above last year in data through October 2018. Beef cow slaughter under Federal Inspection (FI) in that same report is estimated to be up 10.7% above last year's. Taking a cursory look those large slaughter figures, it may seem difficult to believe that the U.S. beef cow herd could show another year-over-year gain on January 1, 2019. But, by our estimates, that is what we are expecting.
The number of beef cows that have calved has grown over the last four years adding 2.6 million head since 2014. This incredible growth pattern has led to larger calf crops, and the economics has supported retaining a large number of heifers in recent years to continue adding to that beef cow number.
Over the last 30 years, the proportion of Federally Inspected (FI) slaughter of beef cows and heifers in the previous year leading up to the January 1 inventory has been about 40%. In recent years, as the cow herd has gained momentum that proportion has fallen to 35%. This year, the number of heifers and cows that have been slaughtered as a percent of the January 1, 2018, has risen back up to 38%. That suggests a return to more normal cull rates in 2018 and a slowdown in beef cow herd growth. In years of herd contraction, that proportion climbs over 40% and is closer to 42% or 43%.
There are still two more months of slaughter data left for this year, but based on our current estimates we see the January 1, 2019, beef cow herd count will be over 31.8 million head, and will likely show very modest growth at 100.2-100.4% of a year ago.