We are approaching the end of 2022 and are getting a more complete picture of beef cow and heifer slaughter and its implications for future supplies. Through October, heifer slaughter is up about 5 percent (402k head) and beef cow slaughter is up 13 percent (375k head) as compared to a year ago. The bulk of the increase in national beef cow slaughter has occurred in the South with beef cow slaughter across the two Southern regions being 271k head higher than a year ago. In particular, beef cow slaughter in Region 6 (AR, LA, NM, OK & TX) is up nearly 30 percent.
Shown in the chart is a regression trend line that was estimated by the Livestock Marketing Information Center (LMIC) using the relationship between beef cow/heifer slaughter and the prior year’s inventory. Or put differently, it is how many cows and heifers were processed this year as compared to how many beef cows we started with. The numbers on the bottom axis (0.32 to 0.48) are proportions. A proportion of 0.4 means that beef cow and heifer slaughter was 40% of the starting beef cow inventory that year. The numbers on the left axis show the annual change in beef cow inventory. A change equal to 1 would mean no change, 1.02 is a 2% increase, and 0.98 means a 2% decline. Using 2014 as an example, the graph shows that cow/heifer slaughter during 2014 was about 41% of the beef cow inventory on January 1, 2014, and the beef cow herd declined just over 2% that year.
2022 is shaping up to be an exceptional year. The orange square on the graph for 2022 represents an estimate for 2022 that assumes the remaining slaughter weeks in 2022 are similar to year-ago levels. In that scenario, the proportion of beef cows and heifers slaughtered would be about 47%. Using this analysis, that would suggest a decline in beef cow numbers somewhere around the 4% to 5% during 2022 which would be levels not seen since 1985-86. Given that most of the beef cow slaughter increase has occurred in the South, it seems likely that cow inventories in these states could decline even more than the national decline.
Author: Josh Maples
Assistant Professor, Livestock, Production Economics, Commodity Marketing