Packer Capacity to Keep Up With Expanding Beef Herd

DanDairy & Livestock, Industry News Release

beef herdA new report says the U.S. beef herd will keep expanding through the end of this decade but there shouldn’t be any need for increased beef packer capacity.

The report from CoBank says the herd will increase 3-5 percent from 2018-2019. Improving pasture conditions and continued profitability in the beef sector have been fueling herd expansion in recent years.

Trevor Amen, an animal protein economist at CoBank, said over the last three years, the expansion has been the most aggressive on record. He says, “Recent slaughter numbers and the cattle on feed mix indicate the expansion rate may be slowing, but barring any significant export interruptions or weather events, the expansion will continue through the end of the decade.” The increasing cattle numbers are bringing more market-ready cattle through the supply chain but expectations are that slaughter capacity should remain sufficient. Amen says plants will be adding extra working hours to get through the increasing supply through 2019. The biggest potential concerns as the industry drifts closer to capacity are labor availability and unforeseen plant shutdowns for maintenance.

From the National Association of Farm Broadcasting News Service.