Global cow herd on a decline to curb dairy price falls

Some key global dairy producers are stepping up on cow culling in response to the sharp decline in global milk prices, according to Gerard Brickley from the Meat Division at Irish food marketing agency Bord Bia. 

The culling will have a significant impact on global beef supplies over the coming years at a time when production is already likely to tighten.

In the US, dairy farmers group Cooperatives Working Together is continuing a series of culls that is removing 10,000 head of cattle per week.

The Cooperative has removed 276,000 cows from production since 2003, and has now accepted bids for 103,000 cows from 388 herds with slaughtering scheduled to be complete by late July or early August.

Producers must then stay out of production for at least a year, in addition to the fact that US dairy cow disposals to May were 11-percent higher from the same period in 2008.

New Zealand's rate of dairy cow growth has slowed. The cow slaughter rate for the first 19 weeks of the 2008-09 season is 45-percent above the previous year.

Argentina's beef sector is plagued by poor farm profitability, extreme drought, high levels of on-farm losses, increased slaughter rates and low pregnancy rates. These factors have led to projections of a 15-percent drop in production during 2010, and Argentina is expected to turn from a beef exporter into a beef importer.

Argentina's calf crop this year is estimated to drop 40 percent due to the poor fertility rates, and that will further impact beef output in the coming years.