CATTLE  INVENTORY  BELOW  A  YEAR  AGO

On Friday, January 29^th USDA released the January 1 Cattle Inventory report which reported the total number of cattle and calves in the U.S. at 93.7 million head, one percent below a year ago and slightly larger than expected.  As expected, the key inventory categories associated with the beef industry posted year-to-year declines.

SHEEP  FLOCK  DECLINES

USDA-NASS also released the January 1 Sheep and Goat on Friday which reported another year-to-year decline in the U.S. sheep and lamb flock.  According to the report, there were a total of 5.63 million head of sheep and lambs on January 1^st, 117,000 head or two percent less than 2009’s and the smallest U.S. flock ever reported by USDA.  Lower slaughter lamb prices in 2009 as well as drought conditions in Texas and California and continued predator losses were the drivers behind the declining U.S. flock.

CULL  COW   PRICES

USDA-AMS reports wholesale prices for beef from cull cows, which are used to estimate the weekly Cutter Cow Cutout value (90 percent lean, 350 pound and up).  After falling to a low of $101.32 per cwt. in late November last year, the Cutter Cow Cutout has slowly recovered supported by a number of factors including, smaller imports of lean beef, year-to-year increases in the cow byproduct value, and continued consumer demand for lower value ground beef items.  By the end of 2009, the Cutter Cow Cutout was at $111.70 per cwt. and as of weekending January 22^nd the cutout had reached $117.01 per cwt.  For the month of January, the Cutter Cow Cutout averaged $116.00 per cwt. versus $111.17 per cwt. in 2009 and the highest monthly average since May 2009.