July 1 Cattle Inventory Implications

DR. ANDREW P. GRIFFITH

KNOXVILLE, TENNESSEE

The July 1, 2026 cattle inventory report was released at the end of July. This report is not as comprehensive as the January 1 report, but the mid-year report does contain valuable information as it relates to the size of the calf crop and heifers retained for breeding. Thus, this is an appropriate time to evaluate the numbers and discuss what is likely to happen the second half of the year.

All cattle and calves were reported at 94.2 million head compared to 94.0 million head one year ago. The quantity of beef cows declined 200,000 head from last July and totaled 28.45 million head while the quantity of milk cows increased 200,000 head to 9.65 million head. The quantity of dairy cattle is important as many of these animals are being bred for beef x dairy cross calves, and those calves will make their way to a feedlot sooner rather than later. The total quantity of heifers 500 pounds and over increased 100,000 head from last year to 14.7 million head. This includes 3.8 million for beef cow replacement and 3.6 million for milk cow replacement, which are both 100,000 head more than one year ago. The “other heifers” category declined 100,000 head to 7.3 million head.

The quantity of steers 500 pounds and over increased 100,000 head to 13.9 million head compared to last year while the quantity of bulls 500 pounds and over and heifers, steers and bulls under 500 pounds did not change from the previous year and were 1.9 million and 25.6 million head, respectively. The 2026 calf crop was estimated at 32.5 million head, which is a decline of 496,000 head compared to 2025 while the quantity of cattle on feed increased 200,000 head to 13.2 million head.

There is not enough space in this article to discuss everything, but there is enough space to hit the high points. Beginning with heifers for beef cow replacement, this will be highly variable throughout the country as to the producers who will be able to retain breeding females. One thing that seems certain is regions experiencing drought now and into the fall months will not increase their heifer retention rate to grow the beef cattle herd. Alternatively, regions with good forage conditions and room to expand will likely grow beef cattle herds at a fairly rapid pace. Thus, the 100,000 head increase in heifer retention as beef cow replacements will seem like it is much higher than 100,000 head in some areas while other areas will see a continued reduction in the quantity of beef cows.

 The decline in the calf crop of nearly a half million head was expected to some degree. A profound statement is that fewer cows result in fewer calves, but it has implications that branch several directions. First, the reduction in the calf crop is essentially one week worth of finished cattle slaughter, which is price supportive for calves, feeder cattle and finished cattle. At the same time, if environmental conditions lean more toward heifer retention this fall then the market could see further reductions in the quantity of cattle in the slaughter pipeline totaling closer to two weeks of slaughter. Alternatively, a late summer and fall drought could push those heifers into feedlots and the slaughter mix.

The increase in the quantity of cattle on feed stems from both more days on feed and a slower marketing rate. This is not likely to change much until packers are making money. In other words, packers will keep a lid on slaughter rates until there is some money to be made. At the same time, dairy producers are going to keep breeding cows to push crossbred calves into the slaughter mix. The three-day old calf they are producing with each cow is the profit driver in the dairy system. Milk seems to be more of a byproduct to calf production in today’s market. That statement is not entirely true as milk prices are supportive of the industry, but there is money to be made with beef x dairy calves.

In conclusion, there are regions of the country that will expand the beef cattle herd this year. Alternatively, there are regions that will see further declines due to drought. There are winners and losers, and it is not always in an individual’s control.   ∆

DR. ANDREW P. GRIFFITH

UNIVERSITY OF TENNESSEE