Cattle producers are keeping their stock on pasture, a signal that beef supplies will remain tight this year. Retail beef prices have been at record highs recently because of the limited supply of slaughter cattle. The USDA’s monthly Cattle on Feed report says producers put 1.71 million head of cattle on feed during May, 10 percent fewer than in May 2014. The number of cattle sent to slaughter in May, also 1.71 million head, was the smallest total in nearly 20 years. Marketings during April also were the lowest since at least 1996.
In its Livestock, Dairy and Poultry Outlook, the USDA said heavy spring rains, which broke the drought in the Plains, would inspire ranchers to let cattle graze longer on pasture rather than send them to feedlots for fattening for slaughter. “Improved pasture conditions will … leave fewer cattle for placement in feedlots until the end of the grazing season this fall,” said the department. It also said “consumers appear to be backing away from beef at its recent record prices.”
USDA economists said they anticipate “retail beef prices will remain relatively high through 2015 and 2016 as it will take time for cattle inventories and beef production to grow enough to cause noticeable declines in retail prices. At the same time, retail pork and poultry prices are expected to remain competitive.”