It appears that the pieces are all in place to finally turn around the U.S. beef cow herd. There are a number of important pieces but two are critical:

Strong calf prices. As can be seen at top right, calf prices are bumping into record levels once again as stocker operations look

to place cattle on wheat pasture and feedlots try to secure their share of the tight calf supply. How many calves are there? We

don’t really know since there was no July Cattle Inventory report. The absence of that report means that USDA has yet to publish

an estimate for the 2013 calf crop and has not provided any information on inventories by weight class since January 1. The supply

of cattle outside of feedlots was estimated to be slightly larger last January 1 but much of that 0.6% increase was likely due to

delayed placements due to high feed costs. A beef cow herd that was 2.9% smaller, yr/yr, on January 1 has almost certainly produced

about that many fewer calves this year and ongoing heifer retention has tightened things even more. No wonder calf — and

feeder — prices are this high.

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