The arrival of El Niño likely means that additional drought impacts will be minimal and herd expansion may begin. The July Cattle inventory report may be the first sign showing an increase of beef replacement heifers.
Increasingly tight cattle supplies suggest that margins at all levels above the cow-calf sector will be squeezed in the coming months. The severity of the squeeze and the timing will vary across beef industry segments.
For the second time in a decade, drought has pushed cattle numbers in the U.S. lower than planned and lower than needed to meet the demands of the market.
Persistent drought in major beef cattle production regions continues to have a significant impact on the cattle industry despite improvements in drought conditions in other parts of the country.
With the grilling season set to kick off, lots of attention is focused on beef demand as the tightening of beef supplies will increase the pressure for higher wholesale and retail beef prices.
Global macroeconomic concerns continue to keep beef markets nervous. Slowdowns in some markets have had some impact and, yet global beef markets continue to be resilient and demonstrate continued growth.
Last week, a group from Oklahoma visited Florida to learn about cattle and agricultural production in an environment unlike anywhere else in the country.
In a steady market, fed prices would typically peak seasonally about now and move lower through the third quarter before increasing to year end, but there is good reason to expect the uptrend will continue in 2023.
