Heifer numbers are up. According to yesterday’s Livestock, Dairy & Poultry Outlook  report as of January 1 the heifer inventory stood at 4.3 million dairy replacement heifers in the U.S. That’s up almost 4 percent from a year earlier and up more than 6 percent from two years earlier.

The larger-than-expected rise was triggered by very high replacement prices in 2004 which encouraged producers to keep as many heifers as possible. Even so, the increase may have been aided by particularly low death losses in 2004. The ratio of replacement heifers to milk cows exceeded 47 on January 1, up from less than 46 a year earlier and easily a record.

Almost 2.9 million heifers are expected to calve and enter the milking herd in 2006. That’s up almost 3 percent compared to the previous year. These extra heifers should significantly ease tightness in replacement heifer supplies, allowing for the belated replacement of some marginal cows as well as making it easier to fill new barns, the report says.

Milk cow numbers in 2006 are now expected to increase slightly faster than previously thought.

Despite the large heifer supplies, strong demand has kept replacement prices high.

January’s price of $1,840 per head was more than $200 above a year earlier. In addition, the seasonal decline from last October’s record was modest. Some easing of heifer prices is possible this year, but demand for animals to fill new or expanded facilities is projected to stay strong throughout 2006

USDA, Economic Research Service