USDA’s National Agricultural Statistics Service (USDA-NASS) issued the July 1 Cattle inventory report last week confirming U.S. cattle inventories continue to decline. Not many surprises were in the report, as the pre-report ranges were rather small and on target. Beef cow slaughter’s aggressive pace which now sits at 14% above a year ago, contributing to the large decline in the breeding herd, down 2.5% from 2021. 

Drought continues to plague much of the western U.S. and conditions in the southern plains are worsening. Deteriorating range and pasture conditions are forcing producers to place more lambs on feed which are at levels that have not been seen since 2018. Since the start of the year monthly lambs on feed have been running about 40,000 to 68,000 head above year ago levels. Weekly yearling lamb slaughter averaging about 31,000 head or about 2.0% below last year following the Easter holiday season.

The advanced estimate, first of three, for second quarter Gross Domestic Product (GDP) was announced this week. Real GDP according to the Bureau of Economic Analysis decline 0.9% from the previous year. Pre-report forecasts had anticipated a small rebound from the 1.6% decline in the first quarter, collectively expecting a 0.5% bump.