CattleFax; 2021 Cattle Market Outlook
- Even though the U.S. cowherd is going into its third year of contraction, the effects of COVID-19 will keep cattle prices subdued as we head into 2021.
- One major effect from the virus is the abundant supply of fed cattle that will hit the market in first few months of 2021 because of the backlog of feeder cattle that was created in the second quarter of 2020.
- If all goes as planned, the second half of 2021 should see a significant price improvement with cattle supplies becoming more manageable and pandemic disruptions coming to an end, which will greatly benefit the restaurant industry.
- Another highlight heading into the next year is that consumer beef demand is expected to be at its third-highest level since 1998.
- The USDA All-Fresh Retail Beef Price averaged $6.35/lb. this year. Retail beef prices in 2021 are expected to decline $0.35/lb., but this will still be the third highest annual average on record.
- Beef proved to still be king in 2020 as retail beef sales represented 46 percent of total red meat and poultry spending, up one percent from the year before.
- The biggest concern regarding beef demand in 2021 is unemployment and decreased disposable income levels as COVID-19 continues to wreak havoc.
- Global beef buyers are expected to remain aggressive in 2021 with a 5 percent growth in beef exports projected next year.
- As expected, packers will continue to keep their thumb on cattle feeders in 2021; however, market power could shift significantly in the later part of the year.
- Fed cattle slaughter is expected to fall below year-ago levels in the third quarter of this coming year.
- The 2021 fed cattle market is expected to average $115/cwt. and trade in a range somewhere between $105 and $125.
- With shrinking cattle supplies, cattle feeders should regain some leverage in the fall.
- The U.S. 800 lb. steer price will average around $145/cwt., with a potential to reach $160. There is a chance that the feeder and calf market will get a boost from fed cattle values that are expected to be approximately $70/hd. higher.
- With that being said, increased feed costs may restrict feeder cattle and calf market upside.
- The forecast for U.S. bred cow prices is $50/hd. higher in 2021 with an average of $1,600.
- Cull cow prices are also expected to improve in 2021, averaging $64/cwt.
- Imports are expected to decline, which will favor stronger slaughter cow values.
- Overall, Covid-19 difficulties will continue on in 2021, but tighter cattle supplies will increase leverage for cattle producers, and result in increased market prices.
Maria Bartiromo duped into on-air interview with animal rights activist posing as CEO or Smithfield Foods
- On Wednesday, Fox Business anchor Maria Bartiromo thought she was interviewing the CEO of Smithfield Foods Inc., Dennis Organ, but little did she know she was actually interviewing an animal rights activist posing as Mr. Organ.
- The animal rights activist, Matt Johnson, belongs to Direct Action Everywhere, a grassroots animal rights group.
- The segment focused on providing vaccines to Smithfield’s workers amid an outbreak of coronavirus cases at one of the company’s plants.
- During the interview Johnson stated that the meatpacking industry poses a serious threat in effectively bringing on the next pandemic, with CDC data showing that three of four infectious diseases come from animals.
- He went on to say that the conditions inside Smithfield’s farms are Petri dishes for new diseases.
- Bartiromo was a bit skeptical as the interview went on, even rolling her eyes at one point.
- By the end of the show, Bartiromo reported that Fox had been duped and she apologized for the confusion.
Boxed beef prices
- Choice boxed beef: $207.54 (-3.13)
- Select boxed beef: $197.93 (-1.66)