Cattle Cycle Ups and Downs Result in Slowdown for Expansion in 2019
Cattle Cycle in 2019
In the U.S., cattle cycles traditionally happen about every 10 years with cattle being added or removed from the herd during market swings. However, from 1996 to 2013 the cattle cycle was prolonged says Kevin Good, vice president of industry relations with CattleFax.
“We liquidated in 16 of 18 years because of prolonged drought,” Good adds of the period from 1996-2013.
Moisture conditions have improved during the past few years which have fueled rebuilding of the beef cow herd.
During the past five years the total beef herd has grown by about 6.5 million head. It breaks down to approximately 3 million more beef cows, 1.5 million additional cattle on feed and another 2 million feeder cattle and calves that are outside of feedlots.
“We’ve had a pretty big updraft, as far as numbers, fortunately demand has stayed strong, trade has stayed strong, so prices are still at a level that keeps the bulk of producers profitable,” Good says.
CattleFax and Good are projecting the cattle cycle to slow down now that it is entering its sixth year of expansion. The supply of cattle for beef should reach a point where expansion halts in the next couple of years, resulting in tougher prices from the large supply.
For more on Good’s thoughts about the cattle market listen to his interview with AgDay or read the following story about CattleFax’s projections for 2019:
