The nation's cattle herd is increasing according to the Cattle Inventory report from USDA Friday afternoon. The nation's total cattle population has climbed to 97.1 million head, up 1.7 million from last year. Analysts were looking for about 96.9 million head so the report is fairly neutral. However, the year-ago inventory was revised downward by 400,000 head so the year-to-year increase was a little larger than expected.

The number of steers over 500 pounds is up 3% from last year which was on the high end of expectations so the news may be a little negative for feeder cattle markets. The number of beef cows is up only 1% from last year so the projected calf crop of 37.8 million head remains fairly small by historical standards. Even so, Friday's report indicates that herd expansion is decisively underway. The total inventory has climbed to the highest level since January 1, 2001.