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As beef cattle numbers rise, cull cow prices drop

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As beef cattle numbers rise, cull cow prices drop

March 27, 2019 - 00:00
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COLLEGE STATION – Prices for most cull cows recently hit their lowest point since 2009, even as Texas’ beef cattle numbers continue to increase slowly, according to a Texas A&M AgriLife Extension Service expert.

Dr. David Anderson, AgriLife Extension economist, College Station, said Texas producers are adding cattle to their operations, and most classes of cattle were close to breakeven despite the lowest prices in a decade. However, some classes, such as cull cows, have seen prices tumble well below breakeven.

Texas has the largest beef cattle herd in the U.S. with around 4.6 million head in January 2018, according to the U.S. Department of Agriculture. Anderson said the state and national herd continues to slowly build with relatively good prices and consumer demand.

“It’s the largest cow herd since 2009, but we’re also seeing the lowest prices at market since 2009,” he said. “We’re hoping to see that seasonal bump in prices that typically occurs between late fall and June. We’ve seen a little bit of an increase, which is positive, but not much.”

Higher costs associated with high-priced hay to supplement winter feeding won’t do anything to help profit margins, Anderson said. The summer drought followed by continuous rains placed a high demand on hay bales throughout the state this winter.

“We fed a lot of expensive hay to cattle this winter, so we need a price recovery to pay for that,” he said.

However, beef and dairy cull cows have hit new lows, Anderson said. Cull cows are typically destined to become hamburger meat.

In Oklahoma City, which had the most comprehensive data, cull cow prices were $46.92 per hundredweight in December, which was the lowest price since $46.58 per hundredweight in December 2009. The highest December price for cull cows was $116.50 per hundredweight in 2014.

“The dairy industry has been struggling with weak prices and lots of dairies going out of business all around the country,” he said. “That is sending so many cows to market that cull prices are seeing low to no profit.”

AgriLife Extension district reporters compiled the following summaries:

CENTRAL: More than 1 inch of rain was reported in many parts of the district. Storms and high winds damaged some buildings, pivots and barns, and there was freeze damage to some small-grain fields. Mild conditions allowed some fields to dry while low areas were still wet, some with standing water. Corn planting continued. Pastures and rangelands were doing well and beginning to green. Hay feeding of cattle slowed. Nearly all counties reported good soil moisture and good overall crop conditions.

ROLLING PLAINS: Most of the district had moisture, which was beneficial to topsoil conditions. Cotton producers were preparing for planting season. Wheat is looking good, especially where producers top-dressed their fields. Spring oats were coming up with good stands. Ranchers continued to supplement cow herds with hay and protein. Lice were a problem in many cowherds.

COASTAL BEND: Winds and drier weather allowed producers to enter fields with sandier soils. Farmers were planting corn, grain sorghum and cotton where possible. Previously planted corn and grain sorghum emerged. Some corn seed was exchanged for cotton seed. Remaining cotton stalks from the previous season were being shredded. Fertilizer was applied in some fields. Livestock were doing well, and calves were growing at a good pace. Auction runs picked up since pastures began drying out. Rangelands and pastures were greening up with sunshine. Wildflowers were abundant.

SOUTHEAST: Walker County received 1.5 inches of additional rain, which saturated the soil. Fieldwork for forages, timber or horticulture was limited. Brazos County experienced mild temperatures and enjoyed some much-needed sunshine. Producers in Jefferson County were able to plant rice per U.S. Department of Agriculture RMA guidelines. In Jefferson County, rice planting was delayed. In Grimes County, pastures were greening up, which indicates soil temperatures were warming. Rangeland and pasture ratings varied widely from fair to very poor, with fair being the most common. San Jacinto County reported 100 percent fair, and Montgomery County reported 100 percent good. Soil moisture levels throughout the region ranged from adequate to surplus, with surplus being the most common. Brazos County and Fort Bend County reported 100 percent adequate. Walker, San Jacinto, Jefferson and Montgomery counties reported 100 percent surplus.