Agriculture Department economists say cattle production may be ending its latest tailspin and that some herd rebuilding may be under way.
But it takes nine months of pregnancy before a cow has a calf, and another 18 months or two years before the newborn calf can grow into beef roasts, steaks and hamburger for U.S. consumers.A new outlook report by the department's Economic Research Service noted that the inventory of cattle and calves last Jan. 1 had dropped to 105.5 million head, the lowest in 23 years.
Further, on July 1 the inventory was down 4 percent from a year earlier, the smallest for any summer since the midyear figures were begun in 1973.
If the cattle herd continues to decline at a 4 percent annual rate, analysts said the inventory next Jan. 1 could be around 100 million head. Not since the early 1960s has the U.S. cattle inventory been as small as it is right now. The peak was 132 million in 1975.
Always cyclical, with up years and down years, the current sell-off was stimulated by many factors: low market prices, relatively high feed costs, heavy debt among many producers and lagging consumer demand.
There have been some improvements. Record feed supplies have eased production costs, and the cutbacks by hog farmers have helped take the edge off competition from pork.
One result has been a surge of new cattle going into feedlots for marketing over the next few months. Last week the USDA reported feedlot placements in the major beef states in July at 1.54 million head, up 43 percent from a year earlier. It was the heaviest July placement ofcattle in feeding pens since 1978.
The outlook report said that while the liquidation of cattle herds may be nearing an end, inventories are expected to continue declining through 1987 and that increased production is unlikely before 1988-89, at least.
"Although the mid-year inventory does not contain state data, it appears that producers in some areas have already stabilized their herds or perhaps begun to expand them," the report said.
Most of the country has abundant forage supplies and another bumper hay crop, but the Southeast drought has had a major impact on the cattle situation.