The latest cattle reports from the U.S. Dept. of Agriculture (USDA) suggest that hopes for a U.S. cattle herd expansion might be misplaced optimism. The December Cattle on Feed report reveals a two-percent decline year-over-year in placements, indicating a trend contrary to expectations.
According to University of Missouri Livestock Economist Scott Brown, heavy imports and reduced placements may lead to a potential tightening of cattle supplies in the coming year. Despite an overall increase of three percent in cattle-on-feed, which surpassed earlier estimates, the industry continues to face uncertainty.
In the hog sector, the latest Hogs and Pigs report also painted a nuanced picture for U.S. producers. The breeding inventory is down three percent from 2022, suggesting a reduction in the number of sows. However, Brown noted, pork production remains efficient and pigs per litter showed a noteworthy increase of around four percent. While down from the previous quarter, hog inventory also saw a slight uptick.
Brown also emphasized the crucial insights these reports offer for cattle and hog producers. The focus on hog production efficiency and breeding inventory reductions aims to manage supplies effectively. The unexpected decline in November cattle placements underscores the need for strategic price risk management in navigating the evolving dynamics of the livestock industry. Producers are advised to stay vigilant and adaptable to potential market implications in the coming months.
