The USDA National Agricultural Statistics Service (NASS) released the semi-annual July 1 Cattle inventory report July 25. The current and past reports are available online at: https://usda.library.cornell.edu/concern/publications/h702q636h.

The July Cattle inventory report is usually important because it gives a midyear indication of possible changes to look forward to in cattle numbers, beef production and potential market price effects. The report is less detailed and provides only total U.S. cattle inventory numbers. The January Cattle report provides a more detailed state-by-state breakdown, which allows regional comparisons and weather-related changes to be documented.

However, this year’s report was somewhat less useful to cattle market analysts because NASS did not issue the report in 2024 due to budget constraints. So, a year-over-year comparison that can be valuable, especially when beef cow herd rebuilding may have started, was not possible.

That highlights the need for the cattle industry to make sure the U.S. Congress knows how important these USDA reports are for cattle producers to make informed decisions.

NASS pegged the July 1 U.S. beef cow herd at 28.65 million head, down 350,000 head from the 29 million two years ago in 2023. The January 2025 Cattle report confirmed the beef cow herd was lower in 2024, but what is unknown is if it may have increased slightly by July this year.

The July 1 beef cow estimate is usually higher than the previous Jan. 1 estimate with first calf heifers calving, but this year’s 2.8% increase has historically meant some expansion occurring. Improved moisture conditions in several important beef cattle producing regions, record-high cattle prices, and beef cow slaughter down 17% this year may have been conducive to some beef herd rebuilding.

USDA reported 18% of cattle resided in drought conditions July 1, 2025, compared to 40% in 2023.

The top 10 beef cow states in order of importance are Texas, Oklahoma, Missouri, Nebraska, South Dakota, Montana, Kansas, North Dakota, Kentucky and Florida; which account for 57% of the U.S. beef cow herd. 

Of those states, Texas, Missouri, Oklahoma, Montana, North Dakota and Florida saw increases in beef cow numbers during 2024, indicating interest in beef herd restocking.

The July Cattle report did provide important information on potential calf and feeder cattle supplies. It was the first estimate by NASS of the 2025 calf crop. The calf crop, which includes both beef and dairy calves, at 33.1 million head is projected to decline 430,000 head from 33.53 million head last year. 

July 1 residual feeder cattle supplies outside feedlots was reported to be 34 million head, the lowest in many years. That, coupled with a potential increase in beef heifer retention and the possible Mexican border remaining closed will cause historical tight supplies.

The tight calf and feeder cattle supplies will mean fewer cattle marketed and potentially declining beef production. That will be supportive to fall calf prices.

The Aug. 12 USDA World Agricultural Supply and Demand Report (WASDE) also added support for fall calf prices (www.usda.gov/oce/commodity/wasde). 

USDA is predicting a record corn crop of 16.7 billion bushels, with 2025/26 average corn prices declining to $3.90 per bushel. Additionally, in the WASDE, USDA raised the 2025 fed-steer price prediction from $221 per hundredweight (cwt.) to $227, and increased the 2026 price forecast from $228.50 to $243.50 per cwt.

However, price volatility and risk will likely continue. Drought conditions linger in some areas; the actual size of the 2025 corn crop is to be determined; domestic and export beef demand face challenges; and the effects of geopolitical, tariff, and trade issues are dynamic and uncertain.

Marketing plans with price risk management strategies that set a floor price but leave the top side open should be considered. 

Editor’s note: Tim Petry is a livestock marketing economist with the North Dakota State University Extension Service.