July 20, 2009
US cattle herd liquidation to continue for next two years
The US cattle herd is expected to continue shrinking over the next two years, according to forecasts by CattleFax.
The US beef cow herd has been contracting for the past three years, but it is forecast to fall one percent or 400,000 head to 31.3 million head in 2010. The cow herd is also expected to stabilise in 2011, and then rebuild in 2012.
The number of cattle marketed out of US feedlots so far this year has continued to decline year-on-year, with feedlots struggling to move cattle into a market experiencing sluggish demand.
Fed cattle slaughter is expected to remain tight into 2010 due to a smaller 2009 crop and the expectation of a decline in Canadian fed cattle imports. However, CattleFax expects average carcass weights to rise, restraining the decrease in US beef production which is forecast to fall around three percent in 2010.
CattleFax projects that wholesale beef and fed cattle demand will continue to decline into 2010 and 2011. It is expected that the recovery in the US foodservice segment will be very slow given that the US unemployment rate is forecast to exceed 10 percent by the end of 2009.
