Cattle market profits need to trickle down to feedlots and cow-calf producers
https://www.dtnpf.com/agriculture/web/ag/news/article/2021/03/03/cattle-market-profits-need-trickle
- Last week, boxed beef prices climbed to the second-highest price they have ever been at for that time frame.
- For that same week, cash cattle prices found themselves at the lowest point recorded during the last ten years.
- This spread between boxed beef prices and live cattle prices is alarming to say the least.
- It was ten years ago, back in 2011 when we experienced a similar spread between live cattle prices and choice cuts.
- In the last ten years, live cattle prices have traded anywhere between $119.76 and $136.46 during the fourth week of February.
- Even when you take the strong boxed beef prices out of the equation, last week’s market still traded anywhere from $5.67 to $22.37 lower than the market’s usual live cattle trend for the last week of February.
- When you keep last week’s strong boxed beef prices in the equation, a person would think that would be incentive for a stronger cash cattle market, but that is far from what we’re seeing.
- It is difficult to look back on the recent decade to gain insight into what may lie ahead for the markets in the coming weeks and months.
- The marketplace has endured an incredible amount of change, and it continues to change at a rapid pace.
- As it sits today, the cattle industry is facing drought conditions through much of our nation, a phase of the cattle cycle with herds liquidating and beef demand, both internationally and domestically, growing robustly.
- It is clear that the cattle market is alive and well, but the issue is that the feeding sector and cow-calf producers aren’t reaping any of the benefits from the market’s strength.
- The marketplace has endured an incredible amount of change, and it continues to change at a rapid pace.
- For that same week, cash cattle prices found themselves at the lowest point recorded during the last ten years.
Lawmakers plan to investigate high beef prices affecting Missouri cattlemen
- Missouri Representative David Gregory plans to investigate why consumers are seeing increased costs for beef, while Missouri cattle producers are struggling.
- According to Gregory, there is strong evidence that packers have been coordinating to suppress the price of fed cattle since as early as 2015.
- Last week, Gregory and 26 other Missouri House members sent a letter to the Speaker of the House requesting his support of the investigation into price fixing and anticompetitive practices.
- Gregory said there has been numerous individuals in the industry that have come forward saying they have heard certain conversation or observed certain actions that would elude to illegal activity by the packers.
- Additionally, Gregory and the other House members plan to look into the shutting down of certain packing plants and the importation of cattle.
- “This isn’t just a Missouri problem,” stated Gregory. “This is an agriculture cattlemen’s problem across the entire country,”
- Missouri is the third-largest cow-calf state in the nation with more than 2 million cows.
Texas farm losses seen topping $600 million after winter blast
- According to preliminary estimates from the Texas A&M University’s AgriLife Extension Service, Texas suffered significant losses in their agriculture industry because of the intense winter storm that hit the state last month.
- Extension economists estimate losses of $230 million in citrus, $228 million in livestock and $150 million in vegetable crops.
- According to Jeff Hyde, extension director at Bryan-College Station, freezing temperatures and ice killed or harmed crops and livestock. The winter storm also caused financial hardships and operational setbacks.
- Hyde believes that the residual costs from the severe storm could plague many producers for years to come.
Boxed beef prices;
- Choice boxed beef: $233.88 (+0.85)
- Select boxed beef: $221.68 (-2.56)