Severe Droughts in American West Force Ranchers to Sell Cows at Shockingly Fast Rate: Report

by Chris Haney

Farmers and ranchers out West are feeling the impact from severe droughts that have ravaged the region in recent history. The droughts are now forcing many ranchers to sell their cow herds at the highest rate seen in over a decade.

Further, analysts are predicting that beef prices will decrease in the short-term because of an increase in cattle sold. But analysts are also predicting that the sudden change will drive beef prices even higher next year.

Droughts hit California, New Mexico, Texas, and areas of Colorado particularly hard in recent months. Grasslands are drying up, so cattle ranchers are reducing the size of their herds. The mass sell-offs are sending tons of cattle further East. The ranchers are also selling their cattle to feedlots where cows will be fattened up before they’re eventually slaughtered for meat.

According to America Farm Bureau Federation (AFBF), recent heatwaves have impacted 80% of the Western region. The heatwaves have led to extreme droughts over the last year. However, the most recent week-long heatwave has brought things to a tipping point. The brutal heat has affected 80 million people across the nation, and has forced many farmers and ranchers’ hands. David Anderson, a professor of Agricultural Economics at Texas A&M, spoke with CNN about the increased cattle sells .

“We haven’t had this kind of movement of cows to market in a decade, since 2011, which was our last really big drought,” Anderson told CNN.

Ranchers aren’t typically inclined to sell-off their cattle in huge numbers. Yet Anderson added that it’s a seller’s market for now and ranchers are earning good prices for their herds.

Droughts and Cost Spikes Leading to Mass Cattle Sell-Offs

In 2021, severe droughts in the West created a similar seller’s market. Upwards of 40% of farmers sold portions of their herds last year, according to an AFBF survey. Fast forward to 2022, and cost spikes for things like fertilizer, feed, and gasoline are exacerbating the issue.

Considering an average adult cow weighs around 1,200 pounds, farmers need a lot of grassland and water to keep herds healthy. In a single day, an adult cow can eat about 20 pounds of grass while drinking up to 30 gallons of water. The lack of rainfall out West is making things increasingly difficult on cattle ranchers. Therefore many ranchers are sending their cow herds to auction.

On a positive note, as mentioned, the increase in cattle sales could eventually lead to lower beef prices at the grocery store. Consumers would welcome the decrease, especially considering that ground beef went up 9.7% in June compared to last year.

Yet the main concern is long-term costs in the future. As ranchers take on smaller herds with fewer breeding cows, analysts are predicting higher beef prices starting in 2023. Analysts believe the increase in beef prices could last two years. Further, beef production is projected to decline by 7% next year, according to the US Department of Agriculture.