“We simply don’t have the replacement heifers to rebuild the cattle herd very quickly, even if weather conditions allow that,” said Tim Petry, NDSU Extension livestock marketing economist, during a recent NDSU Agricultural Markets and Situation Outlook Webinar.

In 2025, there are 4.67 million replacement heifers, the lowest on USDA charts going back many years. Herd rebuilding will be much slower this time with the low number of replacements.

The U.S. had 86.7 million cattle on ranches in early 2025, but beef cow numbers have continued to decline. Numbers may be “a little bit up” in North Dakota.

“We’ve been going down six straight years now on beef cow numbers. Last year was the sixth straight year down to 27.86 million cows in the last couple of years,” he said.

Most expected the beef cow herd to be down about half a percent. Surprisingly, some people thought it might be down more than that, and in fact, the USDA did reduce last year’s numbers by 200,000.

Cow cattle numbers are currently below what they were in the previous cycle in 2014 when prices were a record high. However, from 2014-15, cattle numbers increased in response to the high prices and then prices plummeted from 2016 and afterward quite dramatically.

In 2014, the U.S. had 5.6 million replacement heifers, and that went up to 6 million by 2015. That allowed producers to restock the herd quickly.

As Petry has explained in previous market outlooks, higher carcass weights make up for the low cattle numbers.

“Keep in mind that it isn’t the cow/cattle numbers that are as important, but it’s the amount of beef that we produce. Last year in 2024, we produced the identical amount of beef that we did in 2023, even with fewer cows, and simply made that up by putting 25-30 carcass pounds on every fed steer and heifer that was sold,” he said.

From 2023-24, the U.S. lost almost a million head of beef cows, but put weight on steers and heifers last year, the equivalent of about a million cows.

Going forward, the industry won’t need as many cows when producers do restock, or the beef herd goes up.

“It is not going to go back to 31.6 million because we don’t need that many cows,” Petry said.

The only category that was up was dairy cows, up about 2,500 head, which Petry said was not much when you’re talking 9.3 million head.

“Dairy cows were up a little bit – not a surprise there either because milk prices increased throughout the year last year and feed costs moderated,” Petry said.

In 2025, carcass weights are well above last year’s weights at this time, which is supportive to prices.

Six of the top 10 beef cow states increased cow numbers last year. Texas has the most beef cows by far with 4 million, and Oklahoma, number two, has 2 million beef cows.

A couple of states did do some herd rebuilding last year, but states need moisture to continue to rebuild.

“North Dakota is the eighth largest (in cows), and North Dakota, Montana, and Texas did some herd rebuilding last year where conditions improved and allowed that. But we need the moisture conditions to continue to do that. And right now, we’re kind of struggling,” Petry said.

In 2024, only 8 percent of U.S. beef cows were in drought, while in 2025, 38 percent of beef cows are in drought. Moisture is key.

The U.S. Drought Monitor for the second week in March shows that many of the big cow states, including western North Dakota, are in drought.

“We had the best conditions in June 2024 that we’ve had for a long time, and that is why states like North Dakota and Montana could expand their cow herds,” he said. “Hopefully, this spring, people get a lot of rain and conditions are better and some more beef herd rebuilding might take place.”

Beef prices are doing well, according to Petry.

Talking about calf markets, in North Dakota (Napoleon, Mandan, and Dickinson) in the first full week of March, the average price of 550- to 600-pound calves were at around $3.50 per hundredweight, which were at “all-time record highs.”

“I am projecting for fall to have pretty good prices, but a lot of things can happen. We don’t know what the corn price is, and another big thing to watch is planting intentions, which is coming out March 31. Then there’s also the weather, so there’s a lot of other factors,” he said.

Regarding the futures market, they have tended to be volatile throughout the year, especially over the last couple of weeks.

Some of it has to do with the questions around tariffs. The futures markets does not like uncertainty, and that is what has been happening lately.

“We’re in for a very volatile (time), particularly the futures market here in the next few months,” Petry said, recommending to people to not watch the futures markets, but watch the cash markets. “That’s supply and demand and that’s what’s going on.”