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.
David Anderson, AgriLife Extension economist in 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.”