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Economist says beef-on-dairy trend could explain variances in USDA cattle placements

In recent months the USDA’s Cattle on Feed report has shown inconsistencies in the number of cattle being placed into feedyards.

University of Tennessee ag economist Charley Martinez says beef on dairy calves are likely a contributing factor. “When animals are coming as day olds from dairy producers, they end up usually going to a calf ranch,” he says.  “And those are not captured within the National Agriculture Statistics Service data.”

He tells Brownfield that those calves aren’t incorporated into USDA Cattle on Feed data until marketed through traditional channels. “Some of these massive swings that we’ve been seeing lately could be partially influenced by these fluctuations of the amount of beef on dairy animals that are either entering or not entering counter to the traditional beef that we would think in terms of beef production,” he says.

Placements were down 10 percent in the latest report after being up 6 percent in the USDA’s May report at a time when the cattle herd is historically small. Placements are the number of steers and heifers that have been moved into feedlots during the month.  Fluctuation in placements impacts the number of cattle being harvested in the future.

Martinez says having additional insight into the beef on dairy complex would be beneficial. “It’ll allow us to look at this percentage of heifers that are on feed that might be beef on dairy,” he says.  “In reality, if we are saying an animal is a heifer in the feedyard, well, she wasn’t retained for production, so we still might be in a liquidation phase. But what if that was a beef on dairy female? That animal would never have even thought about being kept as a replacement.”

He says the detection of New World screwworm in the United States could also create additional volatility in the placements number in coming months.