Higher calf prices projected into 2023

Drought conditions in Texas and throughout the U.S. continue to take a toll on cattle numbers, with higher calf prices and less beef production projected for 2023, according to a Texas A&M AgriLife Extension Service livestock economist.

“Most of the country is in some form of drought,” David Anderson, AgriLife Extension economist in the Texas A&M Department of Agricultural Economics, Bryan-College Station, told attendees at the recent South Central Texas Cow-Calf Clinic in Brenham. “Drought affects all aspects of the cattle business. The reason we have culled so many cows this year is because of drought and the cost of corn. High corn prices will lead to a high feed cost environment into next year. Production costs have also increased faster than calf prices.”

Drought-related culling affects future prices Anderson’s price outlook calls for tighter supplies of cattle going into 2023. “In a couple of years, we will be talking about record calf prices again,” he said. “We will likely see over $2 a pound in 2024 for 550-weight calves simply because there are fewer cattle, tighter supplies.” Anderson said that’s being driven by more cull cows and heifers being slaughtered due to the drought. “

“Drought is really affecting where wheat pasture is planted,” he said. “That’s also affected calf prices. Right now, there’s more value in heavier-weighted calves. Why? Feed is expensive.” This is resulting in the biggest slaughter since 2012, which is about 80,000 cows a week, Anderson said.