USDA Reports

USDA Expands Farmer Surveys to Improve Data Accuracy, Relocates Staff Closer to the Farm

Fri, 24 Apr 2026 13:00:55 GMT

USDA is moving to adjust how it collects and communicates agricultural data following an April 22 meeting with stakeholders in Kansas City, pairing expanded farmer surveys, increased transparency efforts and new performance tracking with a sweeping reorganization that will relocate staff closer to agricultural regions.

Leading into the USDA Data Users meeting on Wednesday, Farm Journal spoke one-on-one with USDA Deputy Secretary Stephen Vaden. While he wasn’t in the room physically on Wednesday, instead joining virtually, Vaden made clear he intended to play an active role in the discussion.

“I’m excited about that because one of the things that both the Secretary and I are committed to is better transparency, especially when it comes to our data,” he says. “USDA data needs to be the gold standard, and we need to be brave enough to take feedback. Everyone can always improve.”

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That theme, being “brave enough” to hear criticism, carried through both the meeting and the department’s broader outreach effort. As USDA, ERS, NASS, World Board and others participated in a panel on stage followed by Q&A, they had unified message that they’ll do whatever it takes to rebuild farmer trust and restore confidence in USDA data and reporting.

Earlier this month, USDA closed a public comment period inviting anyone who interacts with its data to weigh in on how it could improve.

“What we have done is we had a public comment process which just closed on the 9th of April, where we asked everyone who has any interaction with our data, tell us what you think,” Vaden says. “Are there ways that we can collect data better? Are there ways that we can report data better?”

Data Users Meeting Highlights Concerns Over Participation, Accuracy

At the Kansas City meeting, one issue stood out: falling farmer participation in USDA surveys and what that means for the reliability of widely watched reports.

Officials from USDA’s National Agricultural Statistics Service (NASS) acknowledged that response rates have dropped to historically low levels. The March 31 planting intentions report drew responses from just 37.6% of surveyed producers, down from 44.3% a year earlier and the lowest on record. But they also talked about plans to improve those numbers.

That decline has raised concerns across the agriculture sector, particularly after USDA made sizable revisions to 2025 corn acreage estimates earlier this year. Because markets rely heavily on USDA data for price discovery, risk management, and policy decisions, even small questions about accuracy can ripple widely.

In response, NASS plans to significantly expand its farmer survey efforts in an attempt to rebuild participation and improve data quality.

USDA Plans Expanded Farmer Surveys to Improve Data Reliability

According to NASS Administrator Joseph Parsons, the agency intends to increase the number of farmers surveyed for major acreage reports, pending approval from the Office of Management and Budget.

The most immediate change would come with the June 30 acreage report, where USDA plans to boost its sample size by roughly 35%. Additional increases of about 10% are planned for the September, December, and March reports.

The goal is straightforward: generate more usable responses and improve the precision of crop estimates.

Beyond simply expanding outreach, USDA is also working to improve how it communicates uncertainty in its reports. Parsons says the agency will incorporate more “plain language” explanations to help producers, traders, and policymakers better understand confidence levels and potential variability in the data.

Reorganization Announcement Follows Immediately After Data Meeting

Just one day after the Data Users meeting, USDA underscored how quickly change is unfolding across the department by announcing a sweeping reorganization that will relocate major divisions, including positions tied to data and research, out of Washington, D.C.

The agency announced the broad reorganization and relocation of staff, saying it will modernize operations. But some stakeholders warn the changes could strain staffing levels and institutional expertise at data-focused offices, including NASS and the World Agricultural Outlook Board, following recent departures tied to the Deferred Resignation Program.

According to USDA’s Thursday announcement, the overhaul will shift key components of the Food Safety and Inspection Service (FSIS) and the Research, Education, and Economics (REE) mission area closer to agricultural regions, in what officials describe as an effort to modernize operations and better align staff with the producers they serve.

At the center of the changes is the creation of a new National Food Safety Center in Urbandale, Iowa, which will serve as the primary hub for FSIS administrative, technical, and support functions. The facility is expected to house roughly 200 employees and become the agency’s largest office. A separate science center in Athens, Georgia, will expand capabilities in microbiology, chemistry, and epidemiology.

USDA officials emphasize that frontline inspection operations, which account for roughly 85% of FSIS personnel, will not be affected, and no reductions in force are planned. Additional staff tied to international operations will be located in Fort Collins, Colorado, while about 100 positions will remain in Washington for policy and congressional work.

The restructuring also reaches into the department’s data and research arms.

The Economic Research Service (ERS) and National Institute of Food and Agriculture (NIFA) will relocate additional positions to Kansas City, reinforcing a move first initiated during the previous Trump administration. NASS will also shift certain Washington-based roles to St. Louis and other regional offices while maintaining its nationwide data collection network.

Meanwhile, the Agricultural Research Service (ARS) will begin decommissioning the Beltsville Agricultural Research Center in Maryland, redistributing research programs across the country to better align with regional agricultural needs and modernize aging infrastructure.

USDA leaders frame the reorganization as a move to reduce duplication, improve accountability, and strengthen connections between federal agencies and the agricultural sector. Deputy Secretary Stephen Vaden says the changes are intended to better align staff with mission needs, while agency leaders emphasize improved workforce support, training, and recruitment.

Greater Transparency and Accountability Ahead

The timing of the reorganization, coming immediately after a meeting focused on data credibility, highlights the broader scope of USDA’s efforts to rebuild trust and improve performance.

Alongside expanded surveys and structural changes, the department is also taking steps to more directly evaluate its forecasting accuracy.

Vaden says USDA is planning to launch an annual report, potentially beginning this fall, that will compare its crop forecasts against final production totals after the marketing year concludes. The effort is designed to give stakeholders a clearer picture of how USDA estimates stack up over time.

“This is not something that will be solved in a day,” Vaden says. “But we have to be brave enough to take feedback and issue public reports on how we did and how our numbers ended up stacking up against the final facts, so that we can begin the process of ensuring that there is continuous improvement with regard to the quality of USDA data.”

Behind the scenes, that process is already underway. Vaden says he is receiving internal briefings on the feedback submitted through the Request for Information and is meeting directly with trade groups and farmer representatives.

“I, as a matter of fact, am receiving a briefing later today on what the comments that came in as part of our request for information show, and how we can have further areas of improvement,” he says. “And I am meeting with some of the commenters… to hear from them personally about how we could do our job better.”

Is USDA’s Reorganization Impacting Data Accuracy?

Even before the formal announcement, questions had already been circulating about whether internal restructuring could affect USDA reporting.

Vaden dismisses that idea.

“Well, first, with regard to your question about whether there’s a link to the data, the answer is no,” he says. “Our WASDE professionals are professionals in the Office of the Chief Economist. They are unbothered by the reorganization. It doesn’t affect their day-to-day work at all.”

In practical terms, he suggests the impact on those teams is minimal.

“The only thing they’re going to have to do is leave the South Building and come over here to the Witten Building for lockup,” he says.

Still, the scale of the changes is significant. USDA is looking to shrink its Washington footprint, where the South Building is more than 70% vacant and carries over $1.6 billion in deferred maintenance, while relocating employees closer to rural communities.

“No private sector company in the world would pay for real estate that is more than 70% vacant,” Vaden says.

Q&A Underscores Concerns Over Trust, Participation, and Transparency

The question-and-answer session at the close of the Data Users meeting made clear that concerns about USDA data go beyond methodology.

Several attendees pressed officials on how the agency plans to reverse declining farmer response rates, with some noting that lower participation could introduce bias into key reports. NASS officials acknowledged the concern and pointed to expanded survey efforts as a primary solution, while also emphasizing outreach to better explain why farmer participation matters.

Officials say they are exploring additional ways to engage producers directly, including clearer communication about how survey data is used and stronger assurances around confidentiality.

Questions also focused on large revisions to recent crop estimates, with market participants asking whether those changes signal deeper issues in data collection or modeling. USDA representatives stressed that revisions are a normal part of the statistical process but acknowledged the need to better communicate why those adjustments occur and what they mean for users.

Another recurring theme was transparency, specifically, how USDA conveys uncertainty in its reports. Attendees urged the department to provide clearer indicators of confidence levels and potential variability, particularly during periods of market volatility. NASS officials pointed to planned “plain language” additions as one step toward making reports more accessible and easier to interpret.

Some participants also raised concerns about whether internal changes, including the department’s broader reorganization, could disrupt data quality or continuity. USDA officials reiterated that statistical staff and processes remain intact and said efforts are being made to ensure consistency regardless of organizational shifts.

Finally, several questions centered on accountability, and how USDA evaluates its own performance over time. Officials confirmed that the department is working toward publishing a regular assessment comparing forecasts to final outcomes, a move widely viewed by attendees as a meaningful step toward rebuilding confidence.

Will Beef-on-Dairy Help Rebuild America’s Record-Low Cattle Numbers?

Tue, 03 Feb 2026 21:10:38 GMT

America’s cow herd has shrunk to levels not seen in 75 years, falling to 86.2 million head. Weather challenges, high input costs and record cattle prices have made heifer retention a difficult decision for many beef producers, keeping numbers tight. In response, more feedlots have turned their attention toward the dairy sector, where beef-on-dairy calves are helping to fill the gap.

Can Beef-on-Dairy Help Fill Feedlot Pens?

As beef cow numbers continue to slide, beef‑on‑dairy calves have stepped up, offering feedlots a steady source of quality cattle. That growing demand is giving dairy farmers a chance to cash in on a market with lucrative returns.

A 2024 industry survey found about 72% of dairy producers are actively using beef-on-dairy breeding programs, and production numbers mirror this trend. CattleFax estimates beef-on-dairy calf production jumped from just 50,000 head in 2014 to 3.22 million in 2024, with projections likely to reach 5 to 6 million head by 2026.

These trends are reflected in the latest USDA numbers, which show just how tight beef supplies are and how the dairy herd is playing a growing role in meeting demand:

The number of milk cows in the U.S. increased 2% to 9.57 million.

Total Cattle and Calves Inventory: 86.2 million head (down 0.35%)
Beef Cow Herd: 27.6 million head (down 1%)
2025 Calf Crop: 32.9 million head (smallest since 1941)
Beef Replacement Heifers: 4.71 million head (up 1%)

(USDA Data)

Brad Kooima of Kooima Kooima Varilek believes the tightest supply of this entire cattle cycle could occur in the next 60 to 90 days. During a recent episode of “AgriTalk”, Kooima highlighted how beef-on-dairy has become a major component helping to keep the beef supply chain strong.

“The gorilla in the room, to me, is beef-on-dairy,” he says. “From a couple of standpoints, the dairy cow herd’s the biggest since 1993. It’s grown and grown, and why wouldn’t you if you can get $1,200 to $1,500 for a day-old calf?”

What used to be a steady stream of native beef calves is now increasingly made up of dairy-beef crosses. Feedlot managers say these cattle have helped provide something the beef industry has long struggled with — a reliable, steady supply.

Dr. Eric Belke, veterinarian and feedlot partner at Blackshirt Feeders in Nebraska, says that need for consistency is exactly why Blackshirt Feeders was designed around beef-on-dairy cattle.

“Historically, in the feedlot world, there has been a lot of seasonality. With the beef-on-dairy population, we have a very consistent flow of cattle throughout the year,” he explained during the 2025 MILK Business Conference. “We needed a very large and consistent supply chain.”

Belke’s experience highlights how some feedlots are restructuring their operations to lean heavily on beef-on-dairy cattle, designing facilities and supply chains around the predictability these animals provide.

“Our feedlot was really built for feeding beef-on-dairy animals,” Belke says. “Right now, we’re at a capacity of 100,000 head, and we’re under construction. Next year, we’ll be at 150,000 head. By the end of 2027, we’ll be at 200,000 head. Currently, we have about 87,000 head on feed, and over 90% of those are beef-on-dairy animals.”

What Impact is it Having on Packers?

That predictable pipeline isn’t just benefiting feedlots. Packers are seeing the results, too.

Each year, several hundred thousand beef-on-dairy animals are processed alongside native beef cattle. And the quality within these animals is strong, with many grading very high Choice and even Prime. That quality has helped secure their place in the market.

Nick Hardcastle, Cargill senior director of meat grading and technical specialist, explains beef-on-dairy calves are an upgrade to the traditional Holstein steer.

“Beef-on-dairy is more desirable because it helped overcome several Holstein difficulties,” he says. “Improvements include red meat yield — more meat to a consumer — as well as improved acceptance in branded programs.”

That progress comes from being more intentional with breeding and management. Since replacement females aren’t the goal for the dairy farmers producing these calves, they and their genetic partners can focus on the traits that matter most to the beef supply chain, like calving ease, feed efficiency, days to finish, carcass weight, marbling and overall yield.

Data is what makes that possible. By linking individual AI sires to feedyard performance and carcass outcomes through electronic identification and data sharing, some supply chains are reviewing sire performance every six months and making rapid adjustments. The result has been a measurable improvement in grade, efficiency and days to finish — driven by genetics and management working together.

The Other Side of a Hot Market

While the beef-on-dairy boom has been a big win for dairy farmers, not everyone is celebrating its rise in popularity. Kooima worries about the long-term effects of vertical integration and the growing control some companies now have over the supply chain.

“For the first time, you’ve got an integrator that can control an animal from its birthday and schedule it out 341 days later to slaughter,” he explains. “It’s a dream the packers chase. I watched what happened in hogs and poultry. This scares me to death. The combination of all of that is we’re losing price discovery. They’re going to try to slow it down as much as they can until they control the supply.”

That tension, between a system solving today’s supply problem and one that could reshape how cattle are marketed, is shaping much of the beef‑on‑dairy conversation.

With the U.S. native beef herd unlikely to rebound soon, beef-on-dairy is becoming an important part of keeping the supply chain steady. While the long-term market effects are still unfolding, the trend highlights how the dairy sector is helping meet the country’s ongoing demand for beef.

How Bullish is the Cattle Inventory Report for the Cattle Market?

Mon, 02 Feb 2026 10:30:16 GMT

USDA’s semi-annual cattle inventory report confirmed the smallest herd in 75 years.
This comes as the cattle industry is still healing from consecutive years of drought, but the surprise is that record high cattle prices aren’t enticing producers to rebuild.
The lack of herd rebuilding has likely extended the historically tight cattle numbers out an additional year.Which means these near to record cattle prices could linger into 2028.

Cattle Inventory Smallest Since 1951
USDA’s semi-annual cattle inventory report confirmed the U.S. cattle herd remains historically small, showing inventory at 86.2 million head, down 317,000 head from last year.

Patrick Linnell, Director of Market Research, CattleFax says: “The total cattle numbers came in down 0 .4 % from year ago, which does take total cattle numbers in the US down to the lowest level that it’s been since 1951. So it does just continue to decline cyclically. and i think that’s the big picture message of this report is that that that expansion while there was some signs of it within this report by and large expansion remains elusive at this point.”

Smaller Beef Cow Herd a Surprise
He says the biggest surprise in the report was a decline in beef cow numbers as the herd is now the smallest since 1961. (Graphic)
Linnell says, “As you looked at just how tight beef cow slaughter was this past year, us and other groups had expected that we would actually see an increase in the beef cow herd. Small, but an increase nonetheless. But however, that’s not what this report showed. It still showed beef cows coming in about 1 % smaller, down about 280 ,000 head.”

Factors Slowing Rebuilding
Linnell attributes the slow expansion to drought, age, lack of labor, higher interest rates, high market risk and financial rebuilding.
“You have a lot of producers who are opting to take the to take today’s paycheck instead of holding back that heifer and counting on returns for her in the future.”

Calf Crop Smallest Since 1941
The calf crop was also down 1.6% at 32.9 million head. The calf crop is the smallest since 1941 indicating the feeder cattle supply will remain tight for a while.”

Linnell says, “The calf crop did come in down about half a million head from year ago, the 2025 calf crop, that is. At the same time, feeder cattle and calf supplies, they continued their decline. 4:02 No surprise there, as you just think about, the multiple years, the continued declines in the calf crop, a slight uptick and heifer retention, and the continued lack of Mexican feeder cattle imports.”

Market Impact
So the cattle cycle isn’t even into the tightest numbers yet.So how long will cattle prices remain strong?
Linnell says, “Fewer potential breeding females coming into 2026 suggests that the calf crop is probably going to be steady to maybe a tick smaller again in 2026 and as you think about the tail of that you know it does suggest that that maybe into the tail of 27 but realistically it’s 2028 before you start seeing an increase in domestic and domestic fed cattle slaughter and domestic fed cattle supplies.”

The wild card is when the border reopens to Mexican cattle.But Linnell is optimistic the cattle market could retest the 2025 highs and stay strong another two to three years.

U.S. Cattle Inventory Hits 75-Year Low at 86.2 Million Head

Fri, 30 Jan 2026 21:08:06 GMT

As of Jan. 1, 2026, the U.S. beef cattle herd stands at 86.2 million head, continuing a downward trend. Despite a year of strong prices, USDA’s annual Cattle Inventory Report released Friday shows the U.S. cattle inventory shrank another 0.35% and now sits at its smallest size in 75 years.

“I would say the story continues,” summarizes Derrell Peel, extension livestock marketing specialist from Oklahoma State University. “I mean, it really doesn’t change the pattern that we’ve been in for the last three years now.”

Quick Report Stats:

Total Cattle and Calves Inventory: 86.2 million head (Down 0.35%)
Beef Cow Herd: 27.6 million head (Down 1%)
2025 Calf Crop: 32.9 million head (Smallest since 1941)
Beef Replacement Heifers: 4.71 million head (Up 1%)

Patrick Linnell, CattleFax director of market research, calls the report bullish.

“I think the big picture message of this report is expansion, while there was some signs of it within this report, by and large expansion remains elusive at this point,” he says.

What Are the Big Takeaways from the USDA Report?

According to Peel, the data highlights two critical areas:

1. Shrinking Cow Herd: The beef cow inventory fell 1% to 27.6 million head.
“The industry technically got a little smaller in 2025,” Peel says.

Linnell adds, “As you looked at just how tight beef cow slaughter was this past year, us and other groups had expected we would actually see an increase in the beef cow herd. Small, but an increase nonetheless. However, that’s not what this report showed.”

2. Heifer Retention Signs: Beef replacement heifers rose 1% to 4.71 million.
“There was a slight uptick in beef replacement heifers, not enough to amount to any growth in 2026, or probably even in 2027, but maybe it’s the beginnings [of a rebuild].”

John Nalivka, Sterling Marketing Inc. president, says the report indicates while replacement heifers was up 1% and those expected to calve were also up 1% from 2024 or 17% of the beef cow herd.

“From 2015 to 2018 when producers began aggressively building herds, the average number of heifers that were identified as replacements on the Jan. 1 inventory was 6.2 million or an average heifer retention rate of 21%,” he explains.

Nalivka says heifer slaughter during 2025, at 9.5 million, was down 7% from the prior year but still represented 52% of the heifers weighing more than 500 lb. on Jan. 1, 2025. In 2024, the industry slaughtered 56% of the January 1 heifers weighing more than 500 lb.

“When the industry was retaining heifers to build herds, the percentage of heifers weighing over 500 lb. that were slaughtered ranged from 39% to 49%,” he adds.

Why is the 2025 Calf Crop Significant?

The calf crop estimate was reduced to 32.9 million head — a 2% drop from 2024. This marks the smallest U.S. calf crop since 1941. This scarcity will be the primary driver for market dynamics in the coming years.

The calf crop in 1941 was approximately 31.8 million head. While the industry saw a significant liquidation in 2014, the calf crop that year only dropped to roughly 33.5 million. This means the current contraction has pushed production levels back more than 80 years.

Outlook: What Will Cattle and Beef Prices Do in 2026?

Peel predicts the small calf crop and tightening feeder supplies will push prices even higher.

“We’ve got record-high prices, and we’re going to see them push even higher for cattle and beef,” Peel says.

He reminds producers it’s important to keep in mind that it’s not just about supply.

“Demand has also continued to be remarkably good for beef as prices have gone up,” he says. “Beef prices have increased relative to pork and poultry. There are alternative proteins that consumers could be turning to, and they’re not. So that’s a very positive sign from a beef industry standpoint.”

The “Historically Slow” Rebuild

Unlike the rapid expansion seen 10 years ago, Peel expects this cycle to be much slower. Producers are cautious, remembering how quickly record prices vanished in the past.

“I do think we’re probably beginning, but it’s certainly not a concerted effort,” Peel says. “There’s not a strong, broad-based initiative in the industry. It will probably grow, but I think it’s going to continue to grow pretty slowly.”

He explains the industry has outlasted the previous cycle highs by two-plus years.

“I think producers are coming around to the idea that this is a more sustained story,” Peel says.

What is the Take-Home Message for Producers?

The market is signaling a desperate need for a rebuild.

“The incentive is there, the value of forage is there,” he says. “If you’ve got forage you can use to raise calves, the market wants you to do that. And if you aren’t fully stocked, then it’s encouraging you to think about doing that. I think the main message for producers is to take advantage of this market.”

He also encourages producers to maintain the productivity of their herds.

“We have cut cow culling so far in the last two to three years that some of these cows are going to have to be culled going forward,” he explains. “So, we got to have a few more replacement heifers just to maintain the productivity of the herd. Take care of that first and then if you need to restock. I understand the tradeoff between selling them now for what is a record price versus investing in the future, but you know, sooner or later, we have to make that investment and look a little bit farther down the road.”

Other January cattle report highlights include:

Of the 86.2 million head inventory of all cattle and calves, cows and heifers that have calved totaled 37.2 million.
The number of milk cows in the U.S. increased 2% to 9.57 million.
The number of cattle on feed was down 3% to 13.8 million.

Nalivka adds, “Only time will tell as the year progresses to determine if USDA’s Cattle Inventory is on track. One cross-check will be cattle slaughter which is an actual number reported to USDA by the packers. The inventory is generated from an annual survey number. I understand that USDA aligns annual surveys with the five-year Agricultural Census. To say the least, I have greater confidence in numbers reported to USDA that can cross-check the validity of the survey.”

He does not expect the Cattle Inventory Report to have an impact on cattle numbers or the market going forward through 2026 and into 2027, particularly with a 2% smaller 2025 calf crop.

“Numbers will continue to tighten and when coupled with continued strong demand for beef will support the market at levels at and likely above the market peak seen during third quarter 2025,” he summarizes.

Glynn Tonsor, Kansas State University ag economist, posted on LinkedIn his analysis of the report. He shares state-level beef cow inventory estimates (of seven states with more than 1 million head) Kansas’ 7% decline stands out while Missouri, Montana, Nebraska and Texas are estimated to be down 1-3% and Oklahoma and South Dakota are flat. Only Texas has a sizeable increase in estimated replacement heifers.

He shares two broader points:

While it certainly is valuable to count the number of beef cows, understand status of herd expansion, and other factors that is far from a complete story on industry supply dynamics. In short, the industry has implemented a number of efficiency gains resulting in the net effect of more edible beef production per cow in the industry.
It has become way too common to focus on supply and overlook demand dynamics. In fact, recent work with Brian Coffey documents how recent beef price patterns have been impacted more by strong consumer beef demand than any supply-side adjustments .

Analyzing the inventory numbers Peel summarizes, “It’s just amazing to me that we continue down this path. We’ve kept extending the timeline. You know, technically, with the beef cow herd and the way we look at cattle cycles, I thought 2025 would turn out to be officially the low. Well, now we’re even smaller in 2026, so we will have to wait until next year’s number to see whether this is the low. We just keep pushing this timeline out that provides even more opportunities for producers to take advantage of this market.”

Bi-annual Cattle report would be called lightly positive. 1) There was no sign of any type of January 2015 expansion (retained beef heifers +9.5%). 2) Overall, numbers came in just below the four analyst expectation. pic.twitter.com/lvNaDBusz3
— Rich Nelson (@RichNelsonMkts) January 30, 2026

To obtain an accurate measurement of the current state of the U.S. cattle industry, NASS surveyed approximately 35,000 operators across the nation during the first half of January. Surveyed producers were asked to report their cattle inventories as of Jan. 1, 2026, and calf crop for the entire year of 2025 by internet, mail, telephone or in-person interview.

Your Next Reads:
Tightest Cattle Supply Predicted in The Next 60 to 90 Days
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Cattle Rally on Higher Cash, Trumping COF: Tightest Numbers Ahead

Mon, 26 Jan 2026 16:20:16 GMT

Cattle and lean hog futures saw early strength on Monday with grains quietly mixed.

Cattle Futures Rally With Cash
Cattle futures saw a mixed opening and quickly moved higher. Brad Kooima with Kooima Kooima Varilek says he was concerned the trade might view a slightly bearish Cattle on Feed report placement number as a reason to sell but the market was more focused on the higher cash trade Friday.

Southern cash ranged from $232 to a few up to $236.50, but the volume was at $233 to $235, steady to $2 higher than last week. Northern dressed trade ranged from $364 to mostly $370, up $5 and live sale prices ranged from $233 to $236.50. So a strong showing that Kooima says may have been pushed somewhat by the winter weather system bearing down on cattle feeding areas.

Cash Trumps Cattle on Feed
The USDA Cattle on Feed report was slightly bearish according to Kooima. On feed totals came in at 96.8% which was in line with expectations but it is still 95% of the five year average, so bullish. The placements at 94.6% of last year were slightly above expectations, while the marketings were at 101.8%, in line with estimates.

Placements Jump in Texas
Kooima says this is the first USDA Cattle on Feed report that is comparing apples to apples, meaning this is the first month of 2025 where the border was closed to Mexican feeder cattle imports. Last year Texas placements were sharply lower as a result so this report showed placements in Texas at 110% of a year ago.

Quarterly Steer and Heifer Breakdown
The quarterly breakdown of steers and heifer in feedlots shows 38.7% were heifers with 61.3% steers. Kooima says this is very close to year ago totals and even the last quarter. So while there is a slight indication of heifer retention its is not enough to cause concern above rapid rebuilding.

Live Cattle Technically Breaking Out?
Live and feeder cattle futures were higher on Friday and for the week but live cattle have been sideways on a chart. So, is the market finally seeing a breakout technically or what would it take to confirm that? Kooima says the highest open interest is in the April live cattle contract and currently he is watching $239.05 on a chart because a close above that level could push futures to the next level. That could cause the chart gap area to be filled and a possible retest of the October all-time highs would be possible.

Lean Hogs Rebound Will Summer Months Close Above $110?
Lean hog futures were back higher after mild profit taking in the front end of the board on Friday. The summer month futures continue to grind into new contract high areas pushed by disease and are knocking on the door of $110. If that level is taken out where is the next objective? Kooima says while the funds could push the market higher he suggests producers look at hedging those levels and locking in some profits.

Corn and Soybeans Hitting Chart Resistance
Corn and soybeans started off lower with some spillover from outside markets that were reacting to President Trump’s threat of 100% tariff on Canada for their trade agreement struck with China. Soybeans were higher last week on hot, dry weather in Argentina and Southern Brazil but were struggling to extend those gains.

The problem according to Kooima is both corn and soybeans continue to run into chart resistance. For March soybeans the 200-day moving average has been a sticking point. While export demand has also been stronger, especially for corn, Kooima says it still isn’t enough to chew through the massive supplies with a record crop and that is keeping a lid on a bigger rally.

Cattle Continue Climb Towards Highs on Strong Cash: Grains See Report Hangover

Tue, 13 Jan 2026 16:44:22 GMT

Cattle futures were higher early Tuesday with hogs 2-sided. Grains were lower seeing report hangover.

Cattle Continue to Climb
Live and feeder cattle futures were higher on Monday with help from corrective buying and a 24 cent drop in corn prices. However, Brad Kooima with Kooima Kooima Varilek says strong cash has also been supportive. Last week’s cash was mostly $232 live in the North and $365 dressed, up $5. The South traded mostly $232 but there there instances up to $234. However, the 5-area weighted average steer price at $231.86, was up just $.18. Still, Kooima predicts fed cash trade will be higher this week as Yankton Livestock was starting out $2 higher. “And I think we have a packer that’s maybe a little closer to the knife, which I think should help,” he adds. The cash feeder market also continues to be red hot with the feeder cattle cash index at $369.13 coming into Tuesday’s session up $.50.

Cash HIgher This Week
Kooima says fed cash will be higher this week as packers are short bought plus the negotiated totals were extremely light last week. “There’s two categories, zero to 14 and 15 to 30 in the 15 to 30 day. And that would be cattle that are bought that aren’t going to get harvested
for 15 days or more. It was only 315 cattle. Usually there’s thousands in that. So I’m hoping that maybe that’ll mean that they have to try a little harder that
they don’t have quite as many cattle in front of them. So we’ll see. Based on the sale barn stuff, it looks like we’d have a shot at it this week. So short answer, long answer, yes, I think that we will see higher cash. “

Packers Cutting Kills
Kooima says packers are seeing margins in the red and cutting kills to compensate. “That seems to be a very popular theme that there’s many packers going to 32 hours this week, which I believe is caused by the fact that there’s not enough cattle to go around,” he says. The packer is not going to buy as many cattle but the result will likely rally the boxed beef quickly. “It’s started already,” he points out. Meanwhile, the Choice cutout values are discounted to the Select which he says is a signal of that tight supply.

Lexington, Neb. Plant Now Closed Shifts Leverage Away From Producers
As we reported on Friday the Tyson plant in Lexington, Neb. already closed on Friday or at least did not schedule any shifts for this week after an announced closure for Jan. 20. Kooima says the closure of this plant will likely take leverage away from negotiated cattle producers in Nebraska as many of those cattle will go to Dakota City, Neb.

“Lexington was largely a formula -only plant. So a lot of these, all these cattle that we’re going from these bigger feed yards into Lexington now have to go somewhere else and that somewhere else is probably Dakota City which is 64 miles from where I’m sitting the closest plant they have. Yet we never sell cattle there almost never. I worry that what’s going to happen is that Dakota City will become a nearly 100% formula plant and that they now all of a
sudden you’ll have less price discovery because they’ll be out of the mix here in terms of buying cattle on a daily basis. So I hope I’m wrong, but I don’t
think I am.”

Feeders Continue to Lead Live Cattle Higher?
While live cattle futures closed lower last week the feeder cattle futures had a higher weekly close and continue to make new highs for the move. Will feeders be able to continue to lead and pull live cattle through chart resistance areas?

“Feeders have long been the leaders here. That’s been very typical of this whole cattle cycle. And that’s been, of course, largely influenced by an incredibly strong cash feeder cattle market. A feeder cattle, cash feeder cattle market that still is a significant premium to where the last futures price is. We’re going to be about $369 on the index today. And January feeders are at $362 .45. So, you know, the dragging the discount up continues.” He says as he looks at the charts he sees a bull flag or bull pennant, “So we need to break out to the top side of it, which I guess I think we will. And then maybe we can take a run at the highs.”

He says the tightest supply is coming in the next 60 or 90 days of the entire cattle cycle and the feeder cattle supply has been pulled forward due to the strong prices. “The guy that’s selling these calves loves the price, he can’t wait to sell them. And so I think, you know, the supply of feeder cattle is not going to be any big amount at all here going into the first quarter of the year. Typically isn’t any way in the north, but it’ll especially be tight, I believe. So, yeah, I think that, you know, to me, the fundamentals and the technicals align here for a chance here that we have one more leg up to go ahead and make a run, and test in those gaps that we left or maybe even taking out those highs.”

Lean Hogs Faltering With Weaker Cash
Lean hog futures traded both sides of steady early in the session but are seeing some pressure as the morning wears on. The futures are trading at a premium to the declining cash index which is dragging down the market. “The cash feels heavy, average weights way above a year ago. Domestic demand seems to be improving because of the price point that it is. But, you know, in terms of export demand, it’s not, it’s just not there. It doesn’t appear to be there anyway. And we have this much supply. You got to have perfect demand.” The lean hog futures saw a correction Monday despite lower feed prices after deferred contracts hitting new contract highs on Friday. Kooima says futures are trading below the 20-day moving averages for the first time in a month, which is a poor technical sign for the market as well.

Grains See Report Hangover
Corn and soybean futures are lower early Tuesday still digesting the bearish data from USDA’s January reports which raised corn yield to a record 186.5 bu. per acre and production to a record 17 billion bu. The key will be whether or not March corn can held the low from Aug. 12 at $4.10. Kooima think there’s a chance because at that time the market was absorbing an even bigger shock from USDA’s 188.8 bu. yield estimate. And corn has to stop going down he says to hold soybeans intact, even though the report was less bearish and there has been some China buying.

However, he says the market is frustrating for producers. “I have great empathy for the grain guys here. Typically when the USDA starts to shrink that yield, they keep doing it. And it takes till January to figure out how many acres, really, huh? So I’m frustrated too with the methodology of it.”

Strong Cash Trade Supports Cattle Futures as Feeders Lead: Grains Mixed

Fri, 09 Jan 2026 16:21:46 GMT

Cattle and hog futures started lower on Friday morning. Grains markets saw pressure in corn and wheat with a little bounce in soybeans.

Cattle Start Weak Awaiting Cash Direction
Live and feeder cattle futures were lower early Friday as the markets have hit some chart resistance and are overbought according to Scott Varilek of Kooima Kooima Varilek. However, it didn’t take long for the markets to firm up supported by the cash market.

Fed Cash Trade Light But Strong
Fed cash cattle trade has been light this week but there was some Northern trade on Thursday paid by at major packer at $228 on a string of around 1,400 head that he was spooked the market. However, it was an outlier as bids started surfacing at $232 offered by three majors that were mostly passed on by feedlots. On the mandatory report USDA also had Northern dressed trade at $360 to mostly $365, which is up $5 from last week’s weighted averages. So, Varilek is anticipating higher fed cash to break Friday and the futures market is as well.

Cash Feeders on Fire
Varilek says the real leadership has been in the feeder cattle market as cash at auction barns has been on fire and the index has tacked on about $19 for the week. So, feeders have been the leaders on tight supplies.

More NWS Cases
However, there was another New World Screwworm (NWS) case that was report in Mexico on an older cow on Friday and there have been additional cases reported on calves. Varilek says there was a lot of talk in the market that the border was going to open to imports of Mexican feeder cattle by the first of the year. However, the additional cases continue to keep the market optimistic and just adds to the already tight supply situation.

Tyson Plant Closure in Lexington, Neb.
Tyson’s beef plant in Lexington, Neb. was initially scheduled to close operations on Jan. 20 but Varilek says their sources say there are no shifts scheduled for next week. He says the closure of the plant will have a negative impact on the amount of negotiated cattle traded in Nebraska. “That was a formula cattle plant and so now those cattle will get divided up and sold at Dakota City and North Platte which will mean fewer homes for negotiated cattle and that isn’t good for the market.”

2025 Cattle Slaughter Tells the Story
USDA’s slaughter figures for 2025 did show total inventory was down over 6% from the previous year. However, Varilek says the other story that was hidden in that data is that beef cow slaughter was down 17% from a year ago. This is lower than in recent previous years and indicates to him that there is some female retention starting to take place.

Lean Hogs Fall with Cash
Lean hog futures were down early on Friday on profit taking after running into chart resistance and getting oversold after Feb. hit 2.5 month highs. However, Varilek says the cash trade is also getting sloppy. The national negotiated cash market was down $3.24 on yesterday’s close and the lean hog index was down $.27 coming into the session at $80.98. However, he says the summer months are still well above $100 which is an indication of the disease reduced inventory expected in that time frame.

Grains Position Ahead of Reports
Corn and wheat were lower early Friday with the stronger dollar, while soybeans saw a bounce on a flash sale of 7.3 million bu. to unknown destinations. However, Varilek says the markets are more dominated by positioning ahead of the big USDA reports on Monday.

Is the Slide in Grains All About South America? What Rallied Livestock Tuesday

Tue, 30 Dec 2025 21:26:18 GMT

Grains ended slightly lower on Tuesday with cattle and hogs higher.

Grains Slide Further on Year End Positioning
Grain markets all closed lower for a second day this week on follow through technical selling. Rich Nelson with Allendale, Inc. says there is a general lack of news for the markets so some of the pressure is coming from end of the quarter and end of the year positioning by traders. “So we’ve got two weeks of holidays here. We’re at end of the quarter end of the year. A lot of reasons to take off risk for these markets in general. Along with that we also have some light fundamental news changes.” he says.

South American Weather Favorable
As especially the case for corn and soybeans the markets are also drifting says Nelson due to the lack of weather concerns in South America. Brazil has seen favorable weather and even the dryness in Argentina is starting to ease. Nelson says, “One of the news stories which has been removed, which have been lightly supportive, was this Argentine dryness story. Three weeks in a row, Argentina has seen normal to slightly above normal rain.”

Brazil’s production estimates, at least on soybeans, continue to creep higher and are now are even above 180 MMT. “USDA is not that much lower than everybody else. They are a little bit on the corn side. But for the most part, this market is not finding a rally story from South America. And typically, January and February are the two big months for yield determination for corn and soybean yields down there for sure,” he adds.

Soybean Exports Lagging
Despite more flash exports sales on Tuesday soybeans continued fall. USDA reported daily flash sales of 5.0 million of soybeans to China and 8.5 million bu. to unknown destinations for the 2025-26 marketing year on Tuesday morning. However, soybean exports are still lagging compared to a year ago. “As we head toward this coming USDA report the agency could lower yields but will probably lower exports a little bit here for soybeans and raise domestic crush,” he says.
Currently, he says soybean exports are down 94 million bushels verses USDA’s current projection. Nelson says Allendale project exports down only 30 to 40 million bu. in the January WASDE. He says it’s not because of China but because of other buyers with Brazil soybeans priced below the U.S.

Still, Nelson doesn’t think U.S. soybean prices have to fall much further. “However, on the quite positive side, we feel that these prices have moved quite a bit lower than economic value. And even with our ninety four million bushel cut to exports lately offset by lower yields and also raised domestic crush, we actually would argue like the higher prices are still due in these months ahead for soybeans as well. “

Corn Falls After Testing Resistance
Corn futures were also lower on Tuesday with soybeans and wheat and a higher dollar. However, Nelson says the market went up atnd tested the top side of the trading range on the charts and failed and is now retracing. “We had that attempt here in recent days at trying to break out of of prior highs. We’re not able to do it. We came within just within a nickel of those prior highs.”

Argentina Corn Crop Risk Fading
Nelson says the market may have a difficult time retesting those highs in the short term with the removal of risk with the improved Argentine weather. “It’s actually more important for corn than soybeans, considering the fact that, Brazil’s first crop of corn is relatively small. So I think we can argue that corn probably took the Argentine weather change a little worse than soybeans.”

Corn Yield Lower in WASDE
Nelson says they do find some reasons for higher prices starting with the January WASDE mainly due to a yield cut. “Yes, we’re looking at a yield cut. Maybe exports unchanged or maybe slightly higher on this specific report. So we do look like we do look for this general discussion on ending stocks to drop from roughly2 billion bu. will be down into the high 1.8 billion bu. or low 1.9 billion mark in a month or two,” he explains. That should push prices back to the $4.60 level for March and May.

Wheat Follows Corn and Soybeans Lower
Wheat futures were lower again Tuesday following corn and soybeans and with a higher U.S. dollar index. Nelson says the bearish market mentality is also coming from Russia’s higher wheat export forecast in coming months. He says, “Keep in mind here they were relatively weak exporter in recent months. So we do have that looming bearish issue.”

Plus he says there is a lot of focus on the feed value of wheat in relationship to corn. “As it stands right now, it’s going to take probably higher corn prices to justify a higher wheat prices.”

The wheat market is also numb to the Black Sea tensions. “Whether we have a war the market is still getting Russia and Ukraine exports, and with no war. The market’s still getting, Russia, Ukraine exports,” he adds. This comes even as Russia stepped up attacks on the Odesa port complex.

Live Cattle Futures Stuck, Feeders Breaking Out?
Live and feeder cattle futures were both higher on Tuesday. Still, the live cattle have been unable to take out key resistance on the charts while Nelson says March feeder cattle futures filled the gap area. As a result he thinks the market will stay sideways.

His concern regarding live cattle futures is the drop in wholesale beef prices again last week against the back drop of slightly higher cash prices and negative packer margins. “So far,we do have adequate supplies. Keep in mind here right now, weights finishing weights are running about 3% over last year. This comes on top of the fact that slaughter levels are only down 2% to 4% versus last year, so actual beef production has really not been hit in recent weeks specifically.”

Cash Cattle Trend This Week?
Cash trade averaged $229.33 last week, up $1.36, but on very light volume. Will that trend continue as packers buy for a full kill week next week? Nelson says he’s expecting a mixed trade and packers aren’t likely to be too aggressive. “Maybe light support here for the South. Maybe, lightly negative for the North,” he says.

Lean Hogs Rally Despite Drop in Cash and Cutouts
Lean hog futures were higher Tuesday despite a sharp drop of $1.40 in the lean hog index and lower cutout values. Nelson says it was an impressive move considering the expansion indicated in the Hogs and Pigs Report. “Slaughter rates for the month of December overall, they are holding USDA’s view of a revision for higher supply. So the bear argument has some legs right now.” Yet, futures had the second best close of the uptrend, which Nelson says is positive.

Cattle Hit Fresh Highs on Bullish COF but Can it Continue? Grains Also Rally Monday

Mon, 22 Dec 2025 16:05:00 GMT

Grain and livestock futures are higher early Monday.

Cattle Make Fresh Highs on Bullish COF
Live and feeder cattle futures made new highs for the move Monday morning after a strong close Friday and higher weekly closes. However, the big catalyst is the bullish USDA Cattle on Feed Report data according to Rich Nelson of Allendale, Inc.

Cattle on feed was 2% below December 1, 2024. Placements in feedlots during November totaled 1.60 million head, 11% below 2024. Placements were the lowest for November since the series began in 1996. Marketings of fed cattle during November totaled 1.52 million head, 12% below 2024. Marketings were the second lowest for November since the series began in 1996.

Nelson says the Cattle on Feed placements numbers at 88.8% was extremely bullihs, “We’ve got eight months in a row now of lower than last year placements. They’ve ran about 7 % below last year’s level. So the period from now through early summer will be a little tighter supplies as far as from a feedlot perspective.”

Nelson says the on feed number at 2.2% below a year ago is also a reminder of how historically tight cattle inventory is but with a caveat. “This does tighten our supply argument here quite a bit here. One thing which we will point out, though, as we’ll watch very carefully, is some of this bullish news in recent weeks and months has been kind of offset by the packer-led declines and slaughter numbers. We’ll have to watch very carefully how well they react to this in these coming where the feed lot itself tightens up, and we’ll see if they’re still going to be trying to cut back on numbers.

Cash Cattle Trade Mixed
Cash cattle trade picked up at the end of the week. Cash in the South was at $228 live, down $2 from the previous week under very light volume. A very light dressed trade was reported in the North Friday at mostly $354 to $355, steady to $1 higher than last week’s weighted average, but $3 to $4 lower than most of the volume which was at $358, up $4 from the previous week’s business in Nebraska. Live cash sales at $228 were steady to $2 lower than the previous week in the North.

Boxed Beef Strengthens
The wholesale beef saw impressive gains Friday as choice rose $4.35 to $361.63 while select climbed $2.05 to $346.02. Nelson says cutouts were also higher for the week.

Can Cattle Futures Continue to Rally?
Cattle futures made new highs for the move but can the futures continue to move higher and fill the chart gap areas? Nelson says that may be in the cards. “We can probably fill the first gap directly ahead here for the fat cattle, roughly about $1.50 to $2 to $2.50 higher from here. For the feeders, we can suggest that we’ll probably fill this large gap we’re into right now, which still roughly about another six dollars on higher pricing.”

However, he’s not sure the market can retest the record highs from October. “I do think that the news flow from the prior weeks and months of higher imports could offset the decline in U.S. beef production set for 2026. So we can appreciate a little bit here. We cannot in our viewpoint get to those prior highs in the short term here.”

Lean Hogs Higher, Awaits Hogs and Pigs Report
Lean hog futures were also higher despite lower weekly closes. The market is getting spillover from higher cattle futures and higher cutouts, which were up $2.23 for the week. Nelson says the Lean Hog Index is also holding at $83.73, down just 15 cents coming into the session and indicates the cash market has likely bottomed.

The market is gearing up for USDA’s Quarterly Hogs and Pigs Report on Tuesday afternoon. The average trade guess for all hogs and pigs is 99%, with kept for breeding and market also around 99%. The key will be if the disease problems that are starting to flare up again are confirmed in the report.

Grains Higher on Short Covering
Grain markets were all higher Monday morning on short covering and technical buying. Soybeans were oversold after 27 cent losses last week and a correction of $1.20 off the highs Nov. 18. Flash sales also confirmed China was in for another 12.1 million bu. of soybeans for this marketing year and 2.4 million bu. for 2026-27. He says China has now purchased at least half of their commitments.

Nelson says corn and wheat futures were also getting some support from the delayed export sales report. It showed corn exports at 58.2 million bu. and total sales at 1.8 billion bu. up 30% from a year ago. Wheat exports were at 14 million bu. and now total 710 million bu. up 23% verses last year.

Geopolitical premium was only a slight factor in the rally in the grains as Russia attacked grain facilities in Ukraine ports again over the weekend, amid ongoing peace talks between the U.S., Ukraine and the EU.

As Markets Search for Clarity, USDA Says NASS Will Issue Key Reports in November Despite Government Shutdown

Fri, 31 Oct 2025 16:30:12 GMT

The federal government’s continued shutdown is no longer just a Washington standoff — it’s becoming a real-world problem for farmers and ranchers. As the days drag on without resolution, three Kansas State University economists warn that even with FSA offices back open, the absence of key USDA reports is rippling through every corner of the ag economy, from commodity markets to cattle prices and farm-level business planning.

But on Friday, USDA-NASS issued a bit of surprise. The agency says NASS will release key data in November for the following reports , some with a delay:

Milk Production – Nov. 10 (previously scheduled for Oct. 22)
Crop Production – Nov. 14 (previously scheduled for Nov. 10)
Cattle on Feed – Nov. 21 (as previously scheduled)
Milk Production – Nov. 21 (as previously scheduled)
The World Agricultural Outlook Board will release the World Agricultural Supply and Demand Estimates (WASDE) in conjunction with the Crop Production report on Nov. 14.

With much of the agency still furloughed, there are questions regarding how NASS will have enough staff to provide those key reports. The release didn’t offer any additional details, only saying those key reports will be released in November.

However, there are a few key reports still missing, which includes daily flash sales reports and weekly export sales information.

A Data Blackout Hits the Heart of Agriculture

Until now, the shutdown has silenced the regular flow of government data that producers, analysts and traders depend on — reports like the weekly export sales, crop progress and Cattle on Feed updates, as well as the highly anticipated World Agricultural Supply and Demand Estimates (WASDE).

“The fact that the government is still shut down means we aren’t getting those weekly export sales reports,” says Allen Featherstone, head of the department of agricultural economics at Kansas State University. “That’s a real problem because we rely on that information to confirm what’s actually happening in the market.”

Is China Actually Buying? The Absence of Flash Sales Reports Creates Confusion

With the U.S. and China negotiating renewed agricultural trade commitments , there are fresh promises of more purchases in the weeks and months ahead. U.S. Treasury Secretary Scott Bessent said on Thursday that China has agreed to buy 12 million metric tons of American soybeans during the current season through January and has committed to buying 25 million tons annually for the next three years as part of a larger trade agreement with Beijing.

Featherstone notes that while China claims it is buying U.S. soybeans, the lack of USDA verification makes it difficult to gauge the truth and confirm those buys are happening. And in USDA’s announcement Friday, there was no indication the flash sales and weekly export sales will resume.

“Earlier this week, China reportedly purchased three vessels, about 180,000 metric tons, but not having official data from USDA is a major issue,” he says. “Tracking purchases becomes challenging when the normal reporting mechanisms are down.”

Despite some optimism around U.S.-China trade progress, Featherstone says markets are hesitant to believe much until concrete export numbers appear.

“If China doesn’t come through, that will lead to more negativity in prices given the size of this year’s crop,” he says. “China imports roughly 60% of the world’s soybeans, and if they don’t buy from us, that’s a big problem.”

Featherstone emphasizes the importance of diversifying U.S. export markets.

“We need to broaden who’s buying our products,” he says. “Relying too heavily on one trade partner makes us vulnerable, and this shutdown is a reminder of just how fragile that system can be when government data and diplomacy both stall.”

No November WASDE?

While some private companies attempt to replicate USDA’s data models, those efforts often fall short, according to Terry Griffin, K-State’s precision agriculture economist.

“We’re not likely to have a November WASDE because all the footwork that leads up to it hasn’t happened,” Griffin explains. “Even if the shutdown ends this weekend, that report won’t be ready. There’s just too much groundwork that hasn’t been done.”

He says the lack of USDA reports has forced brokers, trading firms and agribusinesses to depend on private estimates that vary widely.

“They’ve become so reliant on USDA’s National Ag Statistics Service that they’re struggling right now to do their business,” Griffin says. “It’s throwing off everything from national models to local crop forecasts.”

Griffin also points out the shutdown’s impact reaches beyond the boardroom and into academia.

“We have a graduate student working on a peanut production forecasting model, and she’s using crop progress data that come out every week,” he explains. “Without those reports, she can’t validate her model. The data blackout affects research, innovation and business planning all at once.”

Cattle Producers Face Growing Uncertainty

The shutdown’s effects extend deeply into the livestock sector, where missing data is already creating confusion and volatility. Glynn Tonsor, K-State livestock economist, says the absence of reports like Cattle on Feed and slaughter estimates makes it difficult to assess market fundamentals.

“The Cattle on Feed Report is something we normally get monthly. Historically, it has a steer and heifer breakdown, which would be quite useful at the moment as the most recent insight about whether we’re expanding the herd or not, and we’re not going to have that detail,” says Tonsor. “There’s also been a lot of discussion about beef prices and some accusations or desires to make those lower, and we’re actually already behind on what the beef price is in this country. So there’s lots of examples that we could give you that are not just livestock and not just crops. And the longer the shutdown goes, the longer those data gaps exist and build, the harder it is for anybody, whether it’s an academic like us up here or private sector or individual producers, to adjust.”

He notes while we did see life in the cattle market this week, if you look at what happened since President Trump made comments about cattle prices being too high , the cattle market has pulled back significantly in recent weeks.

“Roughly $200 per head has come off the value of cattle in just 10 days,” Tonsor says. “If you’re a cow-calf producer, you’re still positioned for 2025 to be a good year, but uncertainty is the biggest risk right now. Anything that elevates uncertainty delays long-term investments, whether that’s expanding the herd or making capital improvements.”

That uncertainty isn’t only about market data. Tonsor says the political noise out of Washington, including renewed calls for mandatory Country of Origin Labeling (MCOOL), adds to the confusion.

“Taste remains the main driver of beef demand,” he says. “Origin and traceability rank much lower for the average consumer. There are niche opportunities, but for most people, it’s not what decides their protein purchases.”

A Cloud of Uncertainty Over Rural America

For now, K-State’s economists agree on one thing: The shutdown’s ripple effects are growing with every passing day. From grain markets to livestock pricing, from academic research to on-farm decision-making, the absence of reliable government data leaves agriculture flying blind.

“The longer the shutdown goes, the more those data gaps build,” Tonsor says. “And the harder it becomes for anyone, whether you’re an academic, a trader or a producer, to adjust.”

Political Blame Game in Washington

The political blame game continues in Washington, and it’s creating a stalemate. The Democrats are blaming the GOP, and the GOP is blaming the Democrats, both claiming the other party doesn’t care about every day Americans, otherwise the other side would make concessions to reopen the government.

House Committee on Agriculture Chairman Glenn “GT” Thompson, R-Pa., released a statement on Friday, the day before SNAP benefits are set to expire, saying the prolonged government shutdown is caused by Democrats in the U.S. Senate.

“Because Senate Democrats insist on keeping the federal government shut down, more than 40 million Americans — including children, seniors, veterans and military families — will not receive their November SNAP benefits beginning this weekend. The No. 2 House Democrat acknowledged that suffering families are their ‘leverage’, confirming that this is a political choice.”

U.S. Representative Angie Craig, D-Minn., and Ranking Member of the House Ag Committee, says the onus falls on President Donald Trump and Congressional Republicans.

“Secretary Rollins said one honest thing today: The government is failing the American people. Republicans control the House, Senate and White House. The Trump administration has the legal authority and funds necessary to get November SNAP benefits out the door. They are illegally withholding food from 42 million Americans, and it is shameful,” said Craig in a statement on Friday.

USDA Deputy Secretary Stephen Vaden says the fallout extends well beyond the Capitol. From families losing access to food assistance to disruptions in beef and soybean markets, Vaden warns that the consequences are real and immediate.

In an interview on “AgriTalk,” Vaden accuses congressional Democrats of blocking a “clean continuing resolution” and says the resulting gridlock could harm both consumers and producers.

“If they don’t vote to reopen the government, then 40-plus million SNAP recipients see no extra money added to their benefit cards this weekend,” Vaden says. “We shouldn’t be playing politics with people’s lives and people’s dinner tables.”

SNAP and WIC Funding Hang in the Balance

Vaden says USDA manages to keep the Women, Infants, and Children (WIC) program funded for now by reallocating money from other programs. But the Supplemental Nutrition Assistance Program (SNAP), which costs about $9 billion each month, has no such cushion.

“When it comes to SNAP, we’re talking about more than 9 billion — with a B — dollars,” he explains. “We don’t have that kind of money lying around here at USDA. The contingency fund people talk about is nowhere close to that amount, and it’s meant for natural disasters. We surely don’t want to be spending that and then hoping there’s no hurricane while Congress continues this shutdown.”

Without congressional action, Vaden says 40 million Americans might not receive their grocery benefits at the start of November — a moment when both food demand and household strain typically rise ahead of the holidays.

“That’s 9 billion dollars of groceries,” Vaden emphasizes. “And those groceries include beef, pork and poultry. These are markets that are sensitive to even a 1% shift in demand.”

“A Lump of Coal” for the Holidays

As the shutdown looms, Vaden says the timing is especially painful.

“We’re heading into the holiday season; it’s supposed to be a time of good cheer,” he says. “Unfortunately, Senator Schumer and Representative Jeffries are giving everybody a lump of coal. This needs to stop. We shouldn’t be playing games with people’s lives.”

He adds that USDA can move quickly once Congress passes appropriations.

“You want people to receive their SNAP benefits? It’s real simple,” Vaden says. “Give us our normal appropriations, and USDA will do what it does so well: get those benefits onto people’s cards quickly and efficiently.”

Cattle Surge as NWS Nears U.S.: Soybeans Tank as Argentina Drops Export Tax

Mon, 22 Sep 2025 16:05:06 GMT

Cattle and hogs are higher Monday with grain markets lower.

Cattle Surge Higher on New World Screwworm News

Brad Kooima of Kooima Kooima Varilek says live and feeder cattle futures are sharply higher on Monday as news came Sunday evening that New World screwworm (NWS) had been detected 70 miles from the U.S. Mexican border in an 8-month-old calf from a transported herd.

USDA said in a press release Sunday that Mexico’s National Service of Agro-Alimentary Health, Safety, and Quality (SENASICA) confirmed a new case of NWS in Sabinas Hidalgo, located in the state of Nuevo León. This is now the northernmost detection of NWS during this outbreak.

The USDA has activated its 5-point plan to keep NWS out of the country and more announcements are expected in the next 24 hours.

Could Cattle Futures Retest the Highs?

Fund and technical buying was triggered in the cattle futures especially as both markets got back above the 20-day moving averages, which was the breakout level that spurred the recent correction.

If the futures close above these levels Kooima thinks the futures could retest the recent contract and record highs.

Futures Rally Could Mean Higher Cash Cattle Trade

Kooima says if the strong technical action in the cattle futures continues to build this week he thinks it is very likely the cash trade could be higher than a week ago.

He thought cash traded better than expected last week with the South at mostly $240, which was steady and the North at $236 to $238.

Cattle on Feed Neutral

Kooima viewed Friday’s USDA Cattle on Feed report as neutral as the major categories came in close to expectations.

On feed was at 98.9% of a year ago, placements were at 90.1% and marketings at 86.4%.

However, he says with the low placement and marketings he thinks its a sign of heifer retention.

And he explains the lower placements in Iowa, which were down 16%, the function of feedlots already being full.

Hogs Continue Higher

Lean hog futures continue to move higher with some spillover from cattle and continued fund buying as contracts are near contract highs.

However, Kooima is concerned that slaughter pace last week at 2,593,000 was up over last year by 76,000 head and weights are also climbing.

Soybeans Anchor Grains as Argentina Drops Export Tax

Soybeans have taken out key support areas Monday morning with hangover from the disappointing China talks plus a new wrinkle in the Southern Hemisphere.

Argentina suspended their export tax on grains until Oct. 31st in an effort to move stored stocks and ease their financial turmoil.

That is weighing on the soybean, bean oil and meal markets, which is also dragging down corn and wheat.

Cattle on Feed Placements Down 10%: Is Heifer Retention Beginning?

Fri, 19 Sep 2025 20:35:26 GMT

USDA’s September Cattle on Feed Report continues to show historically tight supplies but may also be indicating some signs of heifer retention in the U.S. cattle herd.

On Feed Numbers Down 1%

Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.1 million head on September 1, 2025. The inventory was 1% below September 1, 2024.

This was right in line with trade expectations.

(UDSA
)

State by State On Feed

The state breakouts show on feed totals in Texas at 91% of a year ago, Oklahoma at 95%, Kansas at 103%, with Iowa and Nebraska both at 105%.

Placements 10% Below a Year Ago

Placements in feedlots during August totaled 1.78 million head, 10% below 2024. Net placements were 1.73 million head. This was a percent lower than expectations.

During August, placements of cattle and calves weighing less than 600 lb. were 355,000 head, 600-699 lb. were 265,000 head, 700-799 lb. were 390,000 head, 800-899 lb. were 420,000 head, 900-999 lb. were 260,000 head, and 1,000 lb. and greater were 90,000 head.

(USDA )

State by State Placements

The state by state placements continued to show the impact of the closure of the Southern border to Mexican feeder cattle imports due to New World screwworm (NWS).

Texas placements were at 82% of a year ago, Oklahoma at 98%, Kansas at 89%, while Nebraska was at 96% and Iowa was at 87%.

Marketings Down 14%

Marketings of fed cattle during August totaled 1.57 million head, 14% below 2024. Marketings were the lowest for
August since the series began in 1996.

Other disappearance totaled 51,000 head during August, 6% below 2024.

Is Heifer Retention Starting?

Scott Varilek with Kooima Kooima Varilek, says the placements number was friendly and confirms low cattle numbers, but also the continued strain on feedlots in the South due to the inability to source feeder cattle from Mexico.

“Placements at 90%, versus a 91% estimate, I mean, that’s just kind of continually showing, we’ve got tight numbers, you know, the numbers aren’t there, the calves are not there,” he says.

However, he says the last time placements and markets were this low was in 2015, which may be signaling heifer retention is starting to take place.

” I do think heifer retention is happening. That’s part of the reason we’re seeing these smaller placements and lower marketing those heifers are going back to the cow herd. We’ve got moisture, we’ve got incentive to do so, you know, with a really good market. And, and these guys have sold really, really hard. And now you also have a producer that’s made a lot of money this year. We’ve got to think about it from an income tax perspective too,” he explains.

So he says producers may be holding heifers back deciding if they want to breed them or not.

However, Varilek thinks the rebuild will be much slower than it was in 2015.

Market Reaction

Varilek says with the main categories so close to expectations he’s not expecting much of a market reaction in the cattle futures on Monday.

Cattle Bounce but Can They Fully Recover? Corn Falls, With Soybeans up on China Hopes

Mon, 15 Sep 2025 15:06:39 GMT

Cattle and hogs are higher early Monday with corn lower, but soybeans and wheat holding gains.

Cattle Futures Bounce

Joe Kooima of Kooima Kooima Varilek says live and feeder cattle futures are higher early Monday after a lower day Friday and the second week of lower weekly closes.

Friday’s selloff seemed to be tied to fear of what Ag Secretary Brooke Rollins would be announcing regarding New World Screwworm (NWS) while in Oklahoma.

However, this isn’t the first time this type of talk or fear has triggered selling in the market and funds have been liquidating some of their long position, at least in the feeder cattle futures.

Can Cattle Futures Fully Recover?

Kooima says he is apprehensive about a full recover in the cattle futures after lower weekly closes and a chart that looks somewhat negative for feeders.

Last week the market took out key support at the 20-day moving averages in both live and feeder cattle futures which triggered some massive selling.

The cash market for both fed cattle and feeders is also starting to cool off says Kooima, which may also limit the recovery.

Fed cash cattle traded at $240 live last week in the South, which moved slightly premium to the North.

Northern live prices were mainly $238 to $240, $3 to $5 lower, with the North seeing lower prices on a dressed basis by $5 to $8 at mostly $375 to $378 but on very light volume.

The feeder cattle cash index was down $.39 at $365.47 but Oklahoma City saw cash prices down $8 to $15 according to Koomia.

Seasonally inventory starts to increase this time of year, while demand starts to soften and so this is not uncommon but he says it may keep the market in check for a while.

Lean Hogs Just Off Contract Highs

The lean hog futures are higher again on Monday with cattle and are just off new contract highs.

Funds have been pushing the long side of the market, but fundamentally is this move justified?

Kooima says the cutouts have been holding together and cash has been stronger than normal for this time of year, still seeing the effect of tighter numbers and disease issues.

However, he isn’t sure how much more the futures can extend the gains, especially in the deferred futures as he expects an increase in inventory by spring, with better health in herds.

Corn Futures Lower

After some 10 cent gains on Friday the corn market started lower on Monday morning’s day session.

December futures got above the 100-day moving average but saw some profit taking and report hangover with the record production total of 16.814 billion bu., up 72 million from August.

USDA did report a flash sale of 5.9 million bu. or 148,971 MT of corn to unknown destinations for the 2025-26 marketing year.

Soybeans Up on China Optimism?

Soybeans are slightly higher early with optimism about China talks.

President Trump has posted that they reached an agreement on TikTok and will be talking to President Xi on Friday.

However, Kooima says it has yet to be confirmed by any Chinese media and so farmers need to be cautious about jumping the gun thinking a deal that includes soybeans is around the corner.

Instead, he thinks the market is realizing the tight balance sheet if yields continue to come down in the future due to disease and dryness late in the season.

Can Cattle Retest Highs With Lower Fed Cash? Will Hog Futures Get over $100?

Fri, 12 Sep 2025 14:35:30 GMT

Corn, soybeans and cattle are higher early Friday, with lean hogs slightly lower.

Scott Varilek with Kooima Kooima Varilek says live and feeder cattle futures are higher again on Friday morning with the third day of recovery after Tuesday’s melt down.

What Broke the Cattle Futures Tuesday?

Varilek says there wasn’t any big fundamental news that broke the cattle market on Tuesday, despite talk of the annual Jobs report being the catalyst.

“I think money flow was a big part of it. When you are at these high price levels you just get these type of corrections and funds liquidate. Then cattle feeders chase the market to lock in prices and it just snowballs,” he says.

Both live and feeder cattle futures did take out long term technical support at the 20-day moving averages and sell stops were hit under those chart areas.

Can the Market Retest the Highs?

The fundamental tightness of cattle supplies would suggest the market could retest the record highs, especially as cow slaughter is still down about 36% from a year ago.

However, Varilek says technically the futures will need to close above Thursday’s highs to accomplish that.

“I am watching that $235.75 area on December cattle technically. We need a close above that level to continue to heal this market,” he says.

Can the Market Recover With Lower Fed Cash?

Live cattle futures have been very resilient in the face of lower fed cash trade so far this week.

The South has been in the $240 area on a live sale basis, with some light trade Thursday in Kansas at $238, down $4 from last week, but there is not enough volume for an adequate test.

The North has been quiet with USDA reporting some dressed prices at mostly $375-$378, down $5 to $8, but Varilek says there was a handful of live sales at $237 early but lower live bids at $236 are being passed.

Cash Feeder Market Providing the Biggest Direction

Varilek says for him the cash feeder market is the real leader and after a wobbly start to the week it’s firming up at sale barns.

“The last few days they’ve kind of it feels like they’ve found their footing again here. “Feeder are the leaders and I am leaning on them for direction,” he says.

Can Lean Hogs Climb Above $100?

Lean hog futures consolidated early Friday after more new contract highs were hit in the nearby contracts on Thursday.

However, funds have been buying the futures on breaks and that was the case again Friday.

So, Varilek says it is possible the October could get above the $100 level.

“It has exceeded my expectations. I mean, we’ve had this tighter supply. We had the disease issues last spring that just kept lingering and that’s still that we’re still in that hangover apart from that.” he adds.

Corn and Soybeans Higher Expecting Lower Yields

Corn and soybean futures are slightly higher to start Friday awaiting confirmation of lower yields in the WASDE.

Yield reports are indicating lower results than a year ago, but Varilek says he isn’t sure if USDA will be ready to acknowledge that in this report.

“I am not sure the market will believe it if USDA doesn’t lower yields, just because of the harvest reports we are getting from farmers,” he says.

Are Cattle Prices Due For a Correction? Grains Chop Pre-WASDE

Mon, 08 Sep 2025 14:58:12 GMT

Corn and soybeans drift early Monday with mixed trade in cattle and hogs

Cattle Futures Post First Lower Weekly Close in Weeks

Live and feeder cattle futures were down on Friday and for the week, the first lower weekly closes since June.

Brad Kooima, Kooima Kooima Varilek, says the uptrend line on the charts is also starting to be violated.

Is a Bigger Correction Coming in Cattle?

That alone does not signal a top for him technically as he is still watching the 20-day moving averages on the October and December live cattle.

Funds are long over 130,000 contracts in the live cattle market and have been defending that chart point for several weeks.

On Monday the 20-day falls on the October at $234.45 and in the December at $236.10.

A close below those chart areas could cause the funds to liquidate causing a more sizable correction.

Northern Cash Losing Its Premium to the South

The other fundamental factor that weighed on cattle futures last week was the cash market.

Fed cash cattle trade was at mostly $243 in the North, down $2 from the previous week, while Southern trade was $242 to $243.

Kooima says the North has lost its premium to the Southern cash trade and bull markets are generally led by the North.

“Because that is where we typically trade more negotiated cattle and are more current. Right now there are cattle that are being moved from the North farther South with their tighter numbers and so the freight cost is starting to eat into the Northern cash prices,” he says.

He says that is understandable as well since the South has had fewer feeder cattle supplies with the border closed to Mexican imports.

Boxed Beef Cooling Seasonally

The boxed beef market is also starting to cool and that is the normal seasonal as demand trickles off after Labor Day and the end of the official grilling season.

Choice boxes were down $4.65 last week and closed at $410.76.

However, Kooima points out that prices were historically high at the second highest prices since COVID, so they could see a correction and not mean much relative to cash cattle prices.

Lean Hogs Consolidate Under Contract Highs

Lean hog futures opened mixed and are seeing some consolidation off of contract highs on Friday and higher weekly closes.

Funds have been buying the hog futures and extended their length last week to nearly 124,000 contracts.

Kooima says there are no signs yet on the charts of that technical buying slowing down and cutouts were also up $255 on Friday, now at $115.87 with the Lean Hog Index at $105.92.

Grains Chop Ahead of WASDE

Grain markets were all lower for the week last week but are chopping around early Monday.

Kooima says that may be the trend for most of the week heading into the September WASDE.

He thinks the crop is getting smaller due to disease and dry conditions in the Eastern Midwest but is not sure it will be adequately reflected in this report.

“I am getting a little bullish on corn because of that and would rather be a buyer than a seller at these price levels,” he adds.

Cattle Plunge on Human NWS Case Topping the Market? Corn Up on Pro Farmer Yield Cut

Mon, 25 Aug 2025 15:09:55 GMT

Cattle futures were sharply lower Monday, hogs highs and grains mixed after a higher start.

First Human Case of NWS in U.S.

Brad Kooima of Kooima Kooima Varilek says live and feeder cattle futures gapped lower on the opening after a human case of New World screwworm (NWS) was announced over the weekend.

It was found in a resident of Maryland, who had traveled from El Salvador and that person has received treatment for the infection.

USDA has rolled out a five-part strategy to eradicate screwworms, including building a sterile fly production facility and releasing lab-bred male flies that can’t reproduce into outbreak zones. It’s the first human case in decades on U. S. soil.

Kooima says the market actually handled the news better than he thought it would and he was expecting a lower opening in cattle anyway with the bearish placements figure in the Cattle on Feed Report.

USDA Cattle on Feed Report Bearish

USDA’s August Cattle on Feed Report was slightly bearish as placements came in at 94% of a year ago but the average trade guess was 91%.

He says this is an indication that cattle producers are backing up cattle.

The state-by-state breakouts showed Texas at only 75%, while Iowa was at 118% which also shows the continued influence of the Southern border being closed to Mexican cattle imports.

However, the on feed numbers were at 98% of a year ago, which was as expected and confirms the continued trend of tight supplies.

Cash Convergence

Kooima says cash trade was sloppy in the North last week but higher in the South at mostly $240 live, which was up $5 from the previous week.

He says the cash is starting to converge with futures and the South is starting to converge with the North.

Is the High In the Cattle Market?

The bearish technical action off new contract and record highs on Friday may be signaling a top according to Kooima.

He admits there have been several key reversals the cattle market has negated but he thinks this one might stick.

The reason is because the market is overbought, but also the seasonals are usually weaker for the cattle market in September as the market moves past the Labor Day beef demand peak.

Hog Futures Try to Narrow Discount

Lean hog futures were higher early Monday on spread unwinding with cattle but also extending gains after higher weekly closes.

The October contract is holding a sizable discount to the cash and that may be somewhat attractive to fund traders.

However, Kooima says the cash trade is weakening and it is more likely the futures will fall towards the futures to make up that gap.

Corn Extends Gains

Corn futures were high on Monday extending gains after a higher weekly close and with the tailwind of Pro Farmer cutting yield estimates by 6 bu. below USDA at 182.7 bu. per acre.

Kooima says that confirmation is enough to keep the market in recovery mode, especially with strong exports.

Soybeans See Profit Taking

Soybeans were higher on the opening but ran into chart resistance and saw some profit taking.

The market has rallied nearly 75 cents off the lows and needs additional bullish news to get through these chart areas.

Kooima says exports have been decent despite China being absent from the market, but it might take China purchases to keep the rally going.

USDA Cattle on Feed Report Slightly Bearish: Will The Market Even Care?

Fri, 22 Aug 2025 22:51:32 GMT

USDA’s August Cattle on Feed Report was slightly bearish.

On Feed Numbers 2% Below 2024
The August 1 on feed report listed 10.9 million head, down 2% from August 2024 and in line with trade estimate of 98.1%. This is an 8-year low.

Scott Varilek with Kooima Kooima Varilek says, “We’ve had 98% on feed for several months and slaughter is down 6% versus a year ago, so its less numbers. We are still tight. We know it takes a long time to rebuild numbers in the cattle industry and high prices are sure dangled out there all the way out through the deferred futures.”

Placements 6% Below 2024
Placements in feedlots in July totaled 1.60 million head, 6% below last year but above the average trade guess of 91.1%.

(USDA)

Net placements were 1.55 million head. During July, placements of cattle and calves weighing less than 600 lb. were 340,000 head, 600-699 lb. were 245,000 head, 700-799 lb. were 365,000 head, 800-899 lb. were 378,000 head, 900-999 lb. were 195,000 head, and 1,000 lb. and greater were 75,000 head.

Where did the extra placements come from?

Placement data based on weight did not show a signal division greater than a year ago.

The state-by-state breakdown showed a steady increase across most of the states but compared to a year ago the Southern feedlots were well below 2024, tied to the closure of the Southern border to Mexican feeder imports. Northern feeding areas were above last year.

Texas placements were at 75% of a year ago, Colorado at 76%, Nebraska at 98%, while Kansas was at 102% and Iowa was at 118%.

Varilek says, “So it looks like, you know, Iowa, Kansas did a pretty good job at placements year over year. So that’s picking up some of the slack. Texas, Colorado still well, well down. You know, 75% in Texas, 76% in Colorado. So has more of this, you know, Northern kind of feel to it.”

Marketings 6% Below 2024

Marketings in July totaled 1.75 million head, 6% less than the prior year. and in line with estimates of 94.1%.

Other disappearance in July totaled 51,000 head, 9% under the same period last year.

Will the Cattle Market Care?

Live and feeder cattle futures pushed to contract and all-time highs again on Friday with the push from steady to higher cash trade.

So as long as the cash market stays strong will the futures even break in reaction to the bearish placements?

Varilek says the futures market is overbought and due for a correction so the cattle market could open lower Monday and then quickly get bought by the funds.

“Finishing on these highs and putting $18 on the feeders this week, you know, is it going to be enough to really shock it? I think it could be a little bit of a scare just for as fast as we moved higher in that last little section. But I am not sure it can really break this cash market and that’s what has been bailing this market out time and time again,” he explains.

Cattle Rally Ahead of Reports: Old Crop Corn Below $4, Soybeans Below $10

Fri, 25 Jul 2025 22:27:46 GMT

Grain and hog markets end mostly lower on Friday, with cattle futures higher.

Cattle Markets Rally Ahead of Reports

Cattle futures rallied Friday ahead of the USDA’s Cattle on Feed and Cattle Inventory Reports.

Scott Varilek with Kooima Kooima Varilek says both live and feeder cattle futures had a nice recovery and got within striking distance of the all-time highs set earlier in the week.

Before the futures closed, there were reports of light cash trade in the North at steady to higher money.

The North trade ranged from $375 to $382 dressed, but the volume was mostly $380, up $1 from last week’s weighted average. Live sales ranged from $240 to $242.

After the markets closed some very light business was reported in the South on the Mandatory Report at $226 to $237.50 but the volume was mostly $230 to $232, steady to $2 higher than last week’s weighted averages.

Cattle on Feed Friendly

USDA’s Cattle on Feed Report was bullish with the number of cattle on feed at 98%, down over 1% from the average trade guess. Placements were at 92%, which was 6% below expectations and markets at 96% were in line with estimates.

This report also shows the breakout of heifers versus steers being placed and was at 94.6% on heifers, which indicates very minimal heifer retention he says.

Varilek is calling the report bullish.

Cattle Inventory Shows Slight Herd Rebuilding Compared to 2023

The Cattle Inventory Report showed All Cattle and Calves at 99% compared to July 1, 2023. All cows and heifers was at 99%, beef cows at 99%, Heifers at 98%, Beef Replacement Heifers at 97%.

Average trade guesses were mostly 98% coming into the report but since this was compared to two years ago Varilek says its hard to really make a fair comparison.

Looking at the July 1, 2025 numbers verses the Jan. 1, 2025 numbers they were up slightly but he says not enough to indicate more than mild expansion and the report still confirmed the historically low herd inventory.

So, Varilek thinks the markets will refocus their attention on the cash market for direction.

Lean Hogs Fall

Lean hog futures were mostly lower except the August contract, a mirror opposite of Thursday’s close.

The higher Lean Hog Index and higher cutouts failed to pull up the futures and Varilek says many contracts also ran into chart resistance.

Grains Discount Exports as Funds Sell

Grains were lower for the week with December corn down 8 3/4 cents, November soybeans fell 14 3/4, September hard red winter wheat dropped 2 1/2, September soft red winter lost 8 cents and September hard red spring wheat fell 9 cents.

Grains were also mostly lower on Friday with old crop corn falling below $4 and old crop soybeans below $10, despite some positive export news.

More flash sales were reported by USDA with 4.1 million bushels of new crop corn sold to Mexico, 5.5 million bushels to South Korea and 5.24 million bushels of new crop soybeans sold to Mexico.

Varilek says the funds returned as sellers this week as technically and fundamentally they had very little reason to buy any of the grain markets.

“The bulls tried to make the argument that the corn market needed to rally on the heat, but it’s the end of July and so its kind of late for that. Weather has been nearly ideal this growing season and so the funds are short, especially in corn, and they have no reason to buy,” he explains.

Trade frameworks released this week had very little substance and instead indicated it may be a while before producers see additional purchases so that failed to attract any buying either.

Without some major supply or demand shock Varilek thinks corn and soybeans are poised to retest last week’s lows before harvest.

USDA Cattle on Feed Bullish, Inventory Report Confirms Record Low Herd

Fri, 25 Jul 2025 21:40:09 GMT

USDA’s Cattle on Feed Report was bullish. The Cattle Inventory Report showed the lowest cattle herd in history.

(USDA-NASS)

U.S. Cattle on Feed at 98%

The number of cattle in feedlots with a capacity of 1,000 or more head totaled 11.1 million head on July 1, 2025. That was 2% below last year and below pre-trade estimates of 99.2%. It was also the lowest total since 1996.

The inventory included 6.88 million steers and steer calves, up 1% from 2024. This group accounted for 62% of the total inventory. Heifers and heifer calves accounted for 4.24 million head, down 5.4% from 2024.

Derrell Peel, Oklahoma State University extension livestock marketing specialist, says, “When you look at heifers as a percentage of the cattle on feed inventory it was about 38 % which is actually a tick back up slightly from the April 1 number. So, it says that you know it’s a very slow process we’re still above the long-term average here in terms of the percentage of heifers on feed and so if we are if we are beginning to hold back heifers it’s at a very very slow pace at this point.”

(USDA-NASS)

Placements in Feedlots at 92%

Placements in feedlots during June totaled 1.44 million head, 8% below 2024. However, that was 6% below estimates and the lowest in 16 years.

Peel says both the placements and on-feed totals were bullish.

“The placements came in substantially less than expected and as a result of that, it did change the on-feed number to about a .5% or 1% less than expected. Marketing’s were close to expectations. So, you know, all in all, this is certainly a leaning bullish.And it’s consistent with the idea that we’ve generally been pulling placements down for actually quite a few months now,” he says.

During June, placements of cattle and calves weighing less than 600 pounds were 320,000 head, 600-699 pounds were 235,000 head, 700-799 pounds were 315,000 head, 800-899 pounds were 326,000 head, 900-999 pounds were 165,000 head, and 1,000 pounds and greater were 80,000 head.

State by state placements showed Texas at 82%, Oklahoma at 73%, Nebraska at 87%, while Iowa was at 121% and Kansas was at 114%.

This is a clear reflection of the Southern border closure to Mexican feeder cattle imports tied to New World Screwworm.

(USDA-NASS)

Marketings at 96%

Marketings of fed cattle during June totaled 1.71 million head, 4% below 2024, but in line with expectations. Marketings were the lowest for June since the series began in 1996.

(USDA-NASS)

July 1 Cattle Inventory Down 1% from 2023

All cattle and calves on July 1, 2025, totaled 94.2 million head, 1% below the 95.4 million head on July 1, 2023. This is also the lowest herd in history.

All cows and heifers that have calved totaled 38.1 million head, 1% below the 38.4 million head on July 1, 2023.

(USDA-NASS)

Beef cows, at 28.7 million head, down 1% from two years ago.

All heifers 500 lb. and over on July 1, 2025 totaled 14.6 million head, 2% below the 14.9 million head on July 1, 2023.

Beef replacement heifers, at 3.7 million head, are down 3%.

The trade was expecting most of these categories to come in at 98%, so on the surface is looks slightly bearish showing a slight build in the herd size.

However, Peel says these numbers need to be taken with a grain of salt because they are still below 100% and are compared to two years ago.

“It’s difficult to interpret because we’re comparing to two years ago and we know that we liquidated certainly from 23 to 24. And so, you have to be a little bit cautious in interpreting these numbers,” he says.

Peel says the heifer numbers don’t suggest much heifer expansion, which is consistent with the quarterly heifer on feed numbers.

“So, it’s not showing any real heifer retention,” he explains.

Yet, one number that was a bit of a surprise to him was the July 1 beef cow estimate.

“Take the July 1 beef cow estimate as a percentage of the January 1 estimate, and it’s actually up about 2 .8%, which historically that’s consistent with the time period where we are seeing some herd rebuilding or some herd expansion,” he explains.

Steers 500 lb. and over totaled 13.8 million head, down 1%. Bulls 500 lb. and over was unchanged. Calves under 500 lb. totaled 25.8 million head, down 2%. Cattle and calves on feed for the slaughter market fell 1% from 2023.

Calf Crop Down 1%

The 2025 calf crop is expected to be 33.1 million head, down 1% from last year. Calves born during the first half of 2025 are estimated at 24.3 million head, down 1% from the first half of 2024. An additional 8.8 million calves are expected to be born during the second half of 2025.

Your Next Read: Cattle Prices Predicted to Continue Climbing: Breaking Down the Latest USDA Reports

USDA Set To Downsize With Reorganization Plan

Thu, 24 Jul 2025 18:10:23 GMT

Agriculture Secretary Brooke Rollins announced July 24 that the USDA would reorganize, representing consolidation and elimination of programs and personnel.

Dubbed the “ USDA Department Reorganization Plan ,” the move will include moving more than half of the agency’s Washington, D.C.-area staff to five different hubs across the country, “refocusing its core operations” on USDA’s founding mission, and reducing overall staff. According to the announcement and plan document, the move is intended to “improve the internal management” of the department.

“Here at USDA, we are refocusing our core operations to better align with President Lincoln’s founding mission of supporting American farming, ranching, and forestry, as well as serving American taxpayers,” Rollins wrote Thursday morning on social platform X.

Here @USDA, we are refocusing our core operations to better align with President Lincoln’s founding mission of supporting American farming, ranching, and forestry, as well as serving American taxpayers.
— Secretary Brooke Rollins (@SecRollins) July 24, 2025

The reorganization is built around what the agency calls four pillars:

Ensure the size of USDA’s workforce aligns with financial resources and priorities.
Bring USDA closer to its customers by relocated resources outside of the national capital region.
Eliminate management layers and bureaucracy.
Consolidate support functions.

USDA Workforce Costs and Location Changes

Highlighting the high cost of living in the nation’s capital — where average monthly rent in January 2024 was $2,475, according to real estate and rental search site RedFin — USDA’s reorg seeks to move roughly 2,600 of its current 4,600 D.C.-area personnel to five “hub locations” across the country.

According to the plan document, these locations were selected considering cost of living and “existing concentrations of USDA employees.”

These hubs (and their January 2024 average rent levels) are:

Salt Lake City, Utah ($1,627)
Fort Collins, Colo. ($1,607)
Raleigh, N.C. ($1,371)
Indianapolis, Ind. ($1,265)
Kansas City, Mo. ($1,140)

“In addition to these five hubs, USDA will maintain two additional core administrative support locations: Albuquerque, New Mexico and Minneapolis, Minnesota,” the reorg plan reads. “USDA will continue to maintain critical service centers and laboratories including agency service centers in St. Louis, Missouri; Lincoln, Nebraska; and Missoula, Montana.”

The department says it aims to have no more than 2,000 staff members remain in the National Capital Region.

“The details are still to be determined,” adds Callie Eideberg, a Principal with The Vogel Group. “It will be helpful when we know the pace and cadence of these changes, as that will determine how smooth or chaotic this move will be.”

She agrees that the reorganization could benefit those employees looking for a lower cost of living, but the distance between hubs will make for its own workforce management issues.

“Different administrations have tried, in smaller ways, to move the federal workforce to other regions and they’ve been met with these management obstacles,” adds Eideberg. “Stakeholders, as well, will now need to travel to five different locations around the country to have their conversations with USDA instead of ‘one stop shopping’ in Washington.”

The location changes are not limited to personnel only, however. The physical buildings USDA will be occupying in the capital area will also change. The reorg plan cited costs associated with maintaining and repairing some of the overly large buildings as part of the motivation.

Announced building changes include:

The South Building and Braddock Place facilities will be vacated.
Beltsville Agricultural Research Center will be vacated over several years “to avoid disruption of critical USDA research activities.”
George Washington Carver Center, currently being used for area USDA personnel during the reorg, will be sold or transferred eventually.

The department said the Whitten Building will remain the USDA headquarters, and both the Yates Building and the National Agricultural Library “will be retained for use.”

Consolidation and Elimination

Though the reorg document stressed that “USDA is not conducting a large-scale workforce reduction” as part of the change, it also highlighted that the move is part of its ongoing process of reducing its workforce.

“Much of this reduction was through voluntary retirements and the Deferred Retirement Program (DRP), a completely voluntary tool. As of today, 15,364 individuals voluntarily elected deferred resignation,” the reorg document read.

According to the agency’s own site — both currently and during the previous administration — the USDA has “nearly 100,000 employees.” This makes the stated number of USDA employees who have taken deferred resignation slightly more than 15% of the agency’s overall staff.

Programs within USDA will also be consolidated or eliminated. Those programs and efforts highlighted include:

The Agricultural Research Service (ARS) will eliminate its area offices, with “residual functions” to be preformed by its Office of National Programs.
The National Agricultural Statistics Service (NASS) will consolidate its current 12 regions into five “over a multi-year period.”
The Food and Nutrition Service will reduce its current seven regions into five, aligned with the five hubs, in the next two years.
The Forest Service will “phase out” its nine regional offices in the coming year. It will maintain a reduced state office in Juneau, Alaska, and consolidate its stand-alone research stations into one in Fort Collins, Colo. It will keep its Fire Sciences Lab and Forest Products Lab.
Most “support functions” previously done within the USDA — such as civil rights functions, Freedom of Information Act responses, IT and HR, legislative and tribal relations, and others — will be moved into other agencies of the federal government in an effort “to reduce duplication” within the department.

The reorg document also notes that it will consolidate grants and financial assistance: “This consolidation will include, where feasible, the transfer of grant making and administration functions from USDA offices and agencies that currently have limited capacity to perform such duties to other offices and agencies.”

Most extension personnel in hub-area institutions whom The Packer reached out to about the potential impacts of the reorg either had not responded as of press time or reported that it is too early to provide any meaningful insight.

The News Service from Colorado State University in Fort Collins said, “CSU is continually tracking changes at the federal level and assessing impact to our work.”

Rollins: Impact in Her Own Words

Midday July 24, Rollins spoke to AgriTalk ‘s Chip Flory to talk about the announcement.

“This is just another step in the implementation of getting the government out of Washington, D.C., and getting it to the people,” she says, adding that the move “will save a lot of money.”

When asked if the existing D.C. staff will make the move to the five hubs or if new personnel will need to be hired in those areas, Rollins says she thinks it will be “half and half.”

“For those that do want to continue leading in the Forest Service or working hard on food stamps or, of course, our key work supporting farmers and ranchers, they’re going to have an amazing opportunity to move to, frankly, a better part of the country,” she says. “Out of Washington, D.C., better quality of life, better cost of living and continue to serve the great people of our country. I think that’s a win-win.”

For those who don’t want to move, she says “there are plenty of opportunities in the private sector.”

Rollins adds that the transition is not going to be easy, but the department is ready to do hard work that will streamline its operations and bring services closer to the communities being served. She gave the example of the Forest Service.

“A lot of people don’t know that the USDA manages all of our national forests. We’ve got 11,000 full-time firefighters on the USDA payroll that are constantly battling our fires and are the frontliners,” she says. “The fact that that leadership is in Washington, D.C., but most of the fires are in the West — that doesn’t make any sense. Why don’t we have the leadership of the Forest Service closer to the fires and the firefighters that they serve?”

Cattle Hold Despite Lower Cash: Grain Markets Finally Bounce

Fri, 27 Jun 2025 15:11:48 GMT

Cattle are higher early Friday as well as the grain markets, hogs are lower.

Scott Varilek, Kooima Kooima Varilek, says cattle futures are holding together despite lower cash trade in the country late Thursday afternoon, into Friday morning.

There is more business to do but the early sales are ranging in the South from $222 to $225 but the volume is down around $4 to $5 from last week’s weighted averages. Northern sales live have ranged from $230 to $232, with dressed prices from $365 to mostly $368, down $9.

Varilek says the cash market has been down the last two weeks as the packers have started to regain leverage in part due to their aggressive buying for several weeks out, which has decreased the number of negotiated cattle they need to buy.

Slaughter has been light this week at only 105,000 head on Thursday with two plants running slower chain speeds. The JBS facility in Grand Island, Neb., was down to only 1,000-1,500 head slaughter due to flooding issues. The Tyson plant in Amarillo, Texas, has also been down with labor issues and picketing workers. That plant kills nearly 5,200 head daily.

This has propped up boxed beef values again this week with Choice cutouts just shy of $395. However, Varilek says good consumer demand has also been pushing prices to levels that are only exceeded by price levels seen during COVID.

Futures have been holding together due to their discount to the cash market but would have to see a much bigger correction to change the trend according to Varilek.

Lean hog futures saw early pressure on Friday in response to the USDA Hog and Pig Report which showed a slight increase in the herd at 100.4% of a year ago when the trade was looking for a .4% decline. Other categories also showed some expansion including pigs per litter and pigs under 50 lb.

However Varilek says that does not match up with what they are seeing in the country with a smaller pig herd and farrowing rates tied to disease.

As a result he thinks the pullback in the futures will be short lived.

Grains are trying to bounce on Friday after and ugly week which took corn into new contract lows again.

Varilek says the grains are seeing some short covering in response to news the U.S. and China have struck some type of deal on rare earths, but it is also end of month and quarter and the market is gearing up for the USDA Acreage and Quarterly Stocks Reports on Monday.

However, he doesn’t think the bounce will last long with the favorable weather and large crop in the making.

Cattle on Feed Neutral to Slightly Friendly: Confirms Tight Supply

Fri, 20 Jun 2025 20:06:07 GMT

The June USDA Cattle on Feed Report was neutral to slightly friendly but continues to point to a tight supply picture for the cattle market.

The number of cattle and calves on feed for the slaughter market for feedlots with capacity of 1,000 or more head totaled 11.4 million head on June 1, 2025.

That put inventory 1% below the same date a year ago and in line with pre-report expectations.

Several states continue to see inventory well below 2024 with Texas at 93% and Colorado at 96%, while Nebraska stood at 103%, Oklahoma at 102%, Kansas at 101% and Nebraska at 103%.

This has been a trend as cattle have been moving North to take advantage of the price premium to the South.

Placements in feedlots during May totaled 1.89 million head, 8% below 2024. A friendly number as it was below the average trade estimate of 94.2%.

(USDA )

On a state-by-state basis, placements fell 85,000 head in Texas (83% of a year ago), 50,000 head in Colorado (71%), 15,000 head in Kansas (97%) and 10,000 head in “other states.” Nebraska placements were equal to May 2024.

The lower placements in Central and Southern Plains feedlot states reflects USDA’s closure of the border to Mexican feeder cattle to prevent the spread of New World Screwworm (NWS).

Net placements were 1.82 million head. During May, placements of cattle and calves weighing less than 600 pounds were 335,000 head, 600-699 pounds were 275,000 head, 700-799 pounds were 450,000 head, 800-899 pounds were 516,000 head, 900-999 pounds were 230,000 head, and 1,000 pounds and greater were 80,000 head.

Marketings of fed cattle during May totaled 1.76 million head, 10% below 2024, which was also close to pre-report expectations.

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Cattle Fall Despite Record Cash, Neutral COF: Corn and Wheat Weak

Tue, 27 May 2025 14:57:06 GMT

Cattle and hogs are mostly lower early Tuesday along with corn and wheat, soybeans bounce.

Brad Kooima of Kooima Kooima Varilek says cattle futures are seeing some early weakness despite last week’s record cash and neutral USDA Cattle on Feed Report compared to expectations.

However, it may be another break that gets bought.

Kooima says the Cattle on Feed Report placements came in at 97.4%, which was actually the lowest figure in the last 10 years, next to the COVID year. On feed was at 98.5% and marketings at 97.5%.

The state by state breakouts also showed that states like Nebraska and Iowa had higher placements compared to a year ago, which he says is showing the migration of cattle to the North where cash has been stronger.

Cash last week was at mostly $230, with a few $231 in the North and Kooima says the South saw very little trade at the $220 level.

As a result, he thinks cash will develop early in the South this week as packers are short bought and the trend will be higher as the South attempts to catch up with the North.

Cattle did have higher weekly closes last week but Kooima says the futures need to retest the record highs to be able to fully negate the key reversals.

Lean hog futures are lower with cattle and continue to narrow up the futures premium to the lean hog index.

However, Kooima says growing disease issues with PEDV are making isowean prices shoot higher and that could eventually support buying in the deferred contracts again.

Corn is lower with the break in the wheat market and mostly favorable weather.

Winter wheat production areas like Nebraska, Kansas and Oklahoma got some much needed rain and there’s more in the forecast so wheat is taking out weather premium.

Soybeans are slightly higher on spread trade and following some strength in the soybean oil market.

Peel Calls USDA Cattle on Feed Neutral: Still Confirms Tight Numbers

Fri, 23 May 2025 20:22:34 GMT

USDA’s Cattle on Feed Report was largely neutral compared to expectations but does continue to show a trend of tighter inventory in feedlots.

The number of cattle and calves on feed was pegged at 98.5% compared to a year ago, which was right in line with pre-report expectations.

USDA estimated there were 11.376 million head of cattle in large feedlots (1,000-plus head) as of May 1, down 178,000 head from year-ago.

Dr. Derrell Peel, Extension livestock marketing specialist with Oklahoma State University, says the on feed number has been below year ago levels the last four months.

“We have pretty consistently now seen 1.5% to 2% down on a month-to-month basis. It’s not a fast process. We’re slowly moving that number down. Frankly, I expected to start seeing that more consistently several months ago, but I think we’re into it now. We’re still seeing some month to month variation as is typical in these monthly reports. However, in general, we’re working our way into tighter and tighter feeder supplies,” he explains.

He thinks the tightest numbers will likely not come until 2026.

“The hole really comes once we decide to really get active with herd rebuilding, and that means heifer retention. And that’s going to be a relatively lengthy process,” he says.

Placements in feedlots during April totaled 1.61 million head, 2.5% below 2024, which was just .6% above trade estimates.

During April, placements of cattle and calves weighing less than 600 lb. were 310,000 head, 600-699 lb. were 225,000 head, 700-799 lb. were 370,000 head, 800-899 lb. were 443,000 head, 900-999 lb. were 195,000 head, and 1,000 lb. and greater were 70,000 head.

Marketings of fed cattle during April totaled 1.83 million head, at 97.5% compared to 2024.

Other disappearance totaled 50,000 head during April, 1% below 2024.

In a state-by-state breakdown, placements declined 20,000 head in Texas, 15,000 head in Colorado and 18,000 head in “other states.” Kansas placements increased 10,000 head, while Nebraska moved the same number of cattle into feedlots as April 2024.

Peel called the report neutral.

“The placements on average or came in just a smidge above the average, but well within the range of expectations. Marketing’s were also a smidge above the average guess, pre -report estimate, but also within the range. And when you factor those two against each other, the on -feed total was just about exactly as anticipated going into the report,” he says.

As a result, he doesn’t anticipate much market reaction when traders return on Tuesday following the three day weekend.

Based on these numbers Peel also thinks last week’s key reversal could be negated and its too early to call a top in the cattle market.

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Higher Cash Trumps Slightly Bearish Cattle on Feed Report

Thu, 17 Apr 2025 21:09:17 GMT

The April USDA Cattle on Feed Report was neutral to slightly bearish but will likely be trumped by the strong cash trade prior to the report release on Thursday.

Cattle and calves on feed totaled 11.6 million head on April 1, 2025.

The inventory was at 98% percent on April 1, 2024, slightly below the trade guess of 98.3%.

Placements totaled 1.84 million head or 105% of last year, which was above the estimate of 103.7%.

Marketings of fed cattle during March totaled 1.73 million head, 1 percent above 2024 and compares to the 100.7% guess.

Scott Varilek, Kooima Kooima Varilek, says slightly higher placements than expectations are not a concern to him.

First, the higher figure is largely due to the small number of cattle moved into feedlots in March 2024.

“So, comparing to that small number I think we’re going to be able to fight this off pretty quick,” he says.

Secondly there may have been a shift from month to month in regards to when some of the cattle were placed with the market trying to normalize after the reopening of the Southern border to Mexican feeder cattle imports.

However, the placements were higher in most states as Varilek says there is a big run of grass cattle that is happening right now.

Kansas placements were up by 8% compared to last year, Nebraska was up 11%, Arizona 9%, with Texas up 1%.

“It’s not something that’s alarming saying we found a bunch more cattle. I do not think that that’s the case. It could be some more cattle coming in from Mexico as we’ve got some delayed on you know delayed tariff news we’ve got that border kind of open with Mexico here to start the year. So, could be some more of the Southern cattle moving across but it does look like it’s pretty spread out across the states there wasn’t just one state that jumped off the books,” he explains.

Total on-feed inventory April 1 was estimated at 11.6 million head, which is down 2% from compared to 2024.

(USDA)

He says the 98% on feed number seems more in line with numbers in the country than the past few months when inventory in feedlots was pegged at 100% or slightly above.

“You know, seeing all of those 100% on feed or 101%, it just didn’t even feel like that’s not the market that we’re trading. So 98 is more of an accurate number for me to say, yeah, we have less numbers. That’s why cash is doing what it’s doing right now,” he adds.

The inventory included 7.26 million steers and steer calves, down slightly from the previous year. This group accounted for 62 percent of the total inventory. Heifers and heifer calves accounted for 4.38 million head, down 4 percent from 2024.

That indicates to Varilek that heifer retention is taking place but he thinks it is happening much slower than in 2015.

“The cow herd is depleted at a pretty big level. Slaughter cow prices have been amazing. So, it’s pretty easy to cull off some of those cows that are maybe lower producing and try to re-up your genetics. So, we are seeing some heifer retention,” he says.

Varilek says the cash trade from this week though will trump any negative slant on the Cattle on Feed report.

Cash developed in the North at mostly $212 to $215 live, with dressed deals at $332 to $335, $4 to $7 higher than last week’s weighted average of $328.07.

Kansas and Texas at $210, $6 higher than the $204 weighted average last week.

Live and feeder cattle futures closed strong on Thursday and for the week, pushed by cash.

Varilek says the fundamentals finally took hold and he thinks it’s possible for live cattle futures to retest the recent contract highs set in early April.

Feeder cattle futures were also sharply higher but only April made contract highs trying to align with the index before expiration, but again the deferreds are likely to retest the contract highs in his opinion.

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Beef-on-Dairy: A Critical Solution to the Shrinking U.S. Cattle Herd

Wed, 05 Feb 2025 16:04:57 GMT

The U.S. beef cattle herd is the smallest it has been in 64 years, and there’s little indication that rebuilding will happen anytime soon. Persistent drought and strong cattle prices have discouraged beef producers from retaining heifers, further tightening supply. As a result, the beef industry has increasingly turned to dairy farmers to produce beef-on-dairy crossbreds to help meet growing demand.

USDA NASS says as of January 1 2025, there were 86.7 million head of cattle and calves on U.S. farms.

(Lindsey Pound )

Beef-on-Dairy’s Growing Role in the Industry

During the 2024 MILK Business Conference, Dale Woerner of Texas Tech University highlighted the impact beef-on-dairy has had on the industry.

“Ultimately, these crossbred animals have improved the conventional straight Holstein steer so much, and they’ve offered more volume and a really high-quality product into the beef industry,” he said. “With low native cattle numbers, the industry has to have these cattle. Not only do they have to have them, but they have to have them grade prime or choice.”

Woerner believes that beef-on-dairy crossbreds have added immense value to the beef supply chain and should be seen as a long-term solution. “Beef-on-dairy crossbreds have added enough value to the beef supply chain that we should never change what we’re doing. We should continue creating these crossbred cattle for the future.”

A Reliable and Consistent Supply of Cattle

With native beef cow numbers dwindling in recent years, beef-on-dairy crossbreds have stepped in to fill a critical gap, offering both consistency and quality during a time of supply uncertainty. Despite inevitable market fluctuations, Woerner is confident these crossbred cattle are here to stay.

“While we can’t promise that we’ll always see $800-$900 for a beef-on-dairy calf as we do today, I don’t think we’ll ever return to the low value of purebred Holstein steers from the past,” Woerner added.

Feedlots have become especially reliant on these crossbreds. “Feedlots need these animals – they’re a top commodity,” Woerner noted. “Over the years, many feedlots have gained experience in feeding beef-on-dairy cattle, optimizing their efficiency and performance. From a feedlot perspective, these cattle are in higher demand than ever before.”

The Value of Traceability

Looking ahead, Woerner thinks it’ll take at least three to five years to rebuild the beef herd, depending on weather and market conditions. But even with that, beef-on-dairy crossbred calves are still going to be a valuable part of the industry. One big advantage he sees with these animals is the traceability they offer, which adds extra value and transparency throughout the supply chain.

“Even when native cattle numbers rebound, the traceability system in place with beef-on-dairy crossbreds will continue to offer a level of accountability that sets these animals apart in the marketplace,” he added. “I wouldn’t be surprised if feedlots and packers start offering a premium for that kind of information.”

Challenges Ahead

While the native beef herd has reached record lows and prices have skyrocketed in recent months, beef-on-dairy crossbred cattle have stepped in to help fill the gap. Woerner noted that these crossbreds have provided much-needed consistency and quality during a time of uncertainty. And although the beef herd is expected to gradually rebuild over the next few years, it’s clear that the beef industry will continue to rely on these crossbred animals to meet demand and keep the pipeline full.

Even though the beef herd is expected to rebuild in the coming years, analysts warn that it won’t happen overnight. Arlan Suderman, chief commodities economist at StoneX, pointed out that the industry hasn’t even started rebuilding the breeding herd yet. “The next takeaway is that we have not started rebuilding the breeding herd. As such, perhaps we have a little higher numbers over the next half year or so, but then things get tighter, and more significantly tighter once we actually do start holding back heifers,” Suderman explained.

A Long-Term Solution

With native cattle numbers still under pressure, beef-on-dairy crossbreds are providing the industry with a critical supply of cattle. Their value—through efficiency, consistency, and traceability—ensures they’ll remain an essential piece of the beef supply chain, even as the market continues to evolve.

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U.S. Beef Cattle Inventory Falls to the Lowest Level in 64 Years

Fri, 31 Jan 2025 21:09:20 GMT

Shrinking cattle supplies continues to be the story in the cattle market and part of the reason cattle prices continue to climb. USDA’s annual Cattle Inventory Report released Friday shows the U.S. cattle inventory shrunk another 1% over the past year, now at 86.7 million head. And when you look at just the number of beef cows, that inventory fell 1%, now sitting at 27.9 million head.

Other highlights in the January Cattle report include:

Of the 86.7 million head inventory of all cattle and calves, cows and heifers that have calved totaled 37.2 million
The number of milk cows in the U.S. increased slightly to 9.35 million.
U.S. calf crop was estimated at 33.5 million head, down slightly from previous year.
USDA NASS says the number of cattle on feed were at 14.3 million head, down 1% from 2024

All 👀 were on the January #cattle report today. Here's a look at the #beef cattle inventory over the last 65 years 🥩 . 🇺🇸 Jan inventory was the lowest since 1961 👇👇. At @TerrainAg we have amazing protein economists on the team to help #FarmCredit customers, see their work… pic.twitter.com/weg8KrjcbW
— John Newton (@New10_AgEcon) January 31, 2025

“The big takeaway as we see it was the notable upward revision of last year’s numbers, and we expected that. The past year’s kills have simply been larger than implied by last year’s survey. I think most in the market anticipated that. Not sure if the Algo traders had,” says Arlan Suderman, chief commodities economist with StoneX Group.

“Everything looks pretty in line until you get to that beef replacement heifer number, and I feel like that’s kind of a little bit of a surprise as we’ve been talking about heifer retention,” Scott Varilek, Kooima Kooima Varilek, Sioux Center, Iowa told AgDay’s Michelle Rook. “We’re thinking it’s happening and the last cattle on feed report showed a few less heifers on feed but with a 101 % estimate coming in at 99% we’re still off of year ago levels and still not seeing that rebuild in the cow herd.”

Last year’s USDA Cattle Inventory Report showed the smallest cattle herd in 73 years . And with no strong signs of rebuilding underway, along with strong prices providing no incentive to retain heifers, agricultural economists expected U.S. cattle inventory to shrink even more since last year, which is exactly what USDA revealed on Friday.

“The next takeaway is that we have not started rebuilding the breeding herd. As such, perhaps we have a little higher numbers over the next half year or so, but then things get tighter, and more significantly tighter once we actually do start holding back heifers,” says Suderman.

Higher Highs?

Cattle prices continued to hit records this week. And with no signs of those record prices slowing down, it’s a question of how high these prices will actually go.

According to AgDay’s Michelle Rook, the cattle market continues to smash new records in both the futures market and in cash cattle trade. She reported a strong fed cash cattle market, combined with the border still being closed to Mexican feeder imports has also pushed both live and cattle futures to all-time highs.

Is there any sign of a slowdown in the market, or is a top close? Suderman says fundamentally, the signs show supplies are tight, but the demand piece is a concern.

“Unfortunately, those signs usually come after the top has traded, which is why so many feeders are so nervous,” he says. “Fundamentally, things will still get tighter. But it still comes to the consumer. Consumer confidence pulled back in January, which is a red flag. Headlines are filled with scary scenarios that a trade war over tariffs could bring, which tends to further reduce consumer confidence. That doesn’t bode well for the consumer paying up for the higher cuts of meat at these price levels.”

What Will It Take for Producers to Start to Rebuild?
What would change a producer’s minds and give them confidence to grow their herds again? That’s exactly what we asked in the latest Ag Economists’ Monthly Monitor, which is an anonymous survey of nearly 70 ag economists from across the country. While some said it will just take time, others pointed to the economics of strong cow-calf returns, weaker fed cattle prices and lower prices at the sale barn.

January Ag Economists’ Monthly Monitor

(Lindsey Pound )

Other economists said:

“Today’s high prices are certainly incentive, along with the expectation of moderate feed costs.”
“Government policies, global demand, price cycle”
“Better spring forage supplies could be the most important factor in growth. More quality labor could be critical, too.”
“Confidence that the general economy outlook is positive and that there are unlikely to be negative policy shocks. And, of course, there has to be adequate forage.”
“Improved weather pattern in the West, along with profitable margins.”