Economic Considerations Related to Rebuilding the U.S. Cowherd

Monday, July 21, 2014: 11:00 AM
2101 (Kansas City Convention Center)
Glynn T Tonsor , Kansas State University, Manhattan, KS
Lee L Schulz , Iowa State University, Ames, IA
Abstract Text: The entire U.S. cattle industry is in the middle of several structural changes with pending (or perhaps ongoing) herd expansion at the heart of each current and possible industry adjustment.  These changes coupled with issues more external to the industry are effectively increasing the overall uncertainty of profitability for not only cow-calf producers but stakeholders throughout the industry.  This increased uncertainty will be welcomed by some producers who in turn may choose to expand their herds in coming years.  Conversely, other producers uncomfortable with this uncertainty or facing favorable alternatives to cow-calf production will stabilize or further reduce their herds.  The net impacts of these adjustments will dictate the collective make-up of the U.S. cattle industry for years to come.

The ability of cattle producers to grasp the profitability and overall risk situation of their operations and broader industry trends is critical for long-term business success.  Farmers and ranchers considering expansion need to make sound decisions to make sure their operations are economically sustainable and well-positioned to succeed.  In addition, opportunities exist for integration of young producers and future generations into cattle production, but these individuals need knowledge and tools to help them thrive in the industry.  These expansion and entry into the industry decisions are best made when working with current and accurate understanding of broader economic trends.

This presentation will discuss the broad economic situation motivating growing interest in herd expansion and subsequently outline key trends that are likely to influence realized national herd expansion.  Throughout the presentation, a host of decision aides and related educational resources will be highlighted enabling attendees to act upon information they receive and apply it to their own operation and situation.

Keywords: beef cattle herd expansion, cow-calf production, economics and management