When looking at NASS' most recent cattle inventory report, "The numbers are dropping," noted USDA Livestock Analyst Shayle Shagam.  "Both lower cow numbers and lower replacement numbers."

And, he added, higher numbers of females being put into feed lots.  Shagam added the report has the number of beef replacement heifers, as of July 1st, down 3% from a year ago.  Almost everything, actually, in the report signaling a continued contraction.  Shagam said one big reason, of course:

"The drought and the tight supplies of forage."

Which will continue to influence producer decisions.  However Shagam said they aren't just looking at foreign supplies.

"We're looking at higher costs of a labor, higher cost of energy, these are all factors that the producers are gonna be looking at, in addition to the price that they are receiving for their animals."

Prices that will likely increase as supplies of cattle continue to shrink.


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