John Nalivka discusses the importance of cattle imports and exports

by | Jul 22, 2020 | 0 comments

Photo Courtesy of Five Rivers Cattle Feeding

 

Q: What issues are standing in the way of fair cattle markets? 

Fair is a relative term. A fair cattle market to one cattle producer probably doesn’t hold the same definition for what the next cattle producer considers fair. Producers need to capitalize on premium programs to set their cattle apart; they need to create extra value and capitalize on that value. 

 

Q: What are your thoughts on Senator Grassley’s 50/14 legislation? 

A government mandate requiring a certain percentage of cattle to be purchased through negotiated cash trade is a concerning concept. Getting the government involved within our markets is a poor idea.  

 

Q: What are your thoughts on imports of beef and cattle? 

Trade is a two way street, you must have imports and exports to make trade agreements work. The key to successful trade is a negotiated agreement that is understandable and well thought out.  

 

Q: What are your thoughts on the DOJ investigation into the big four beef processors? 

This is an ongoing saga that’s been unending for a hundred years. The packing industry is a tough business to be in. Economies of scale drive the industry because of the high cost involved. Even if you did break up the packers, in five years we would most likely be right back where we are today.  

 

Q: Do you think our industry is in danger of becoming vertically integrated? 

No, the structure of the U.S. cattle industry is a function of forage availability. This structure is very different than that of the poultry and pork industries. The incentive and motivation to incorporate the cattle industry into a vertical model isn’t there.  

 

Q: How many head of backlogged cattle do you think the industry is facing and how tough will they be to work through?  

The cattle industry is facing right around 500,000 head of backlogged cattle. Most likely, we’ll be working through these cattle through August. This high number of backlogged cattle is an issue, but a bigger issue is the weights. We came into the year well above year ago weights on a weekly basis. When the plant shutdowns occurred, cattle got bigger on a weight that was already too big.   

 

Q: What are your thoughts on fake meat alternatives? 

Fake meat alternatives need to be on everyone’s radar, they’ve seemed to pick up some steam since the Covid-19 outbreak because of prices.  Going forward, our industry needs to keep demand strong, both domestic and international. That means we have to have both sides of the equation: exports and imports.  

 

Q: Any closing statements? 

Ranchers have to tell their story. Until Covid-19, the general public had no idea where their food came from. People need to truly understand where their food comes.  

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