THE US Department of Agriculture’s annual summary of the nation’s cattle inventory released last week shows no real signs of a commencement in herd rebuilding.

Surprising some analysts, the US beef cow herd numbers decreased another one percent year-on-year as of January 1, the data showed.

The nation’s beef cow numbers now stand at 27.61 million head, the smallest since 1961.

Since the cyclical peak in 2019 when the cow herd reached 31.64 million, the US beef cow herd has decreased 4.03 million head or 12.7pc over seven years.

The 2026 low extends the current US cattle cycle to 12 years since the previous low in 2014 – also caused by drought.

Derrell Peel

Although this is likely to be the cyclical low for the national cow herd, it will not be confirmed until next year, Oklahoma State University’s livestock marketing extension specialist, Derrell Peel said in commentary.

He said the USDA’s mid-year July cattle report may provide additional guidance.

“The Cattle report released by USDA last week does nothing to change the strong fundamentals driving US cattle markets,” Dr Peel said.

“Nearly all inventory categories were down year-on-year, including the all cattle and calves total, down 0.4pc compared to last year. The 2025 calf crop was smaller than earlier projections at 32.9 million head, the smallest since 1941,” he said.

Source: OSU. Click on image for a larger view

January’s inventory of US beef replacement heifers was up only 0.9pc on the previous year.  The was the first increase in beef replacement heifers in nine years, since the previous peak in 2017, Dr Peel reported.

“The tiny increase in beef replacement heifers is consistent with recent indications of a minor amount of heifer retention, but is not enough to signal any beef cow herd growth,” he said.

“If anything, it indicates stabilisation of the US herd at current levels in anticipation of potential future growth.”

The USDA inventory report also showed all categories of feeder cattle were down year-on-year, including steers +500 pounds (227kg), down 0.6pc; other heifers +500 pounds, down 1.5pc; and calves +500 pounds, down 0.1pc.

However total feedlot inventories were down 3.3pc compared with January last year.

The calculated supply of feeder cattle outside of feedlots on January 1 was up 0.9pc.

“This does not mean there are more feeder cattle in the country, but simply that a few more of the smaller supply from last year has yet to be placed in feedlots,” DR Peel said.

Little, if any US beef cow herd growth was possible in 2026, he suggested.

“It will depend on beef cow slaughter and herd culling. Beef cow slaughter decreased 40.5pc in three years from 2022-2025, leading to a net culling rate of 8.4pc in 2025.”

“This low culling rate means that older cows will need to be culled going forward.”

Dr Peel said beef cow slaughter was expected to stabilise or perhaps increase some in 2026. That meant that the slight increase in beef replacement heifers will be needed just to maintain the current herd or, at most, increase fractionally in 2026.

“Once again, the US industry is waiting for indications of significant beef heifer retention that would indicate potential beef herd growth,” he said.

“Tight cattle supplies will continue to support cattle prices, likely pushing prices higher.  When increased heifer retention occurs, supplies will tighten further, pushing prices even higher.”

“This, of course, is predicated on continued strong US beef demand, which shows no sign of weakening at this point.”