“They sell their 3 million dollar home in San Francisco and come buy a ranch in Montana. Do they stock that ranch at a rate at which a family ranching operation would stock it? Very likely not.”
Clint Peck is the director of beef quality assurance programming for Montana State University and the Montana Stock Growers Association.
“We are in a fight for acreage, and I don’t care if you’re in Montana where we’re fighting for acreage with the land investors, if you’re in Brazil you’re fighting for acreage with the sugar cane producers, if you’re in Missouri you’re fighting for acreage with the soy bean and corn guys.”
Peck does believe that in the end the economics will shake out.
“We do need more investment in our industry. It makes me real nervous that we might be facing some kind of legislation to curb speculation in the commodity markets, certainly with regard to energy, and I wonder if that might have some unintended consequences as we look at speculation and investment back into things like the cattle feeding industry.”
Peck is forecasting a huge segmentation in the beef markets.
“We’re going to see the lower quality in terms of eating characteristic products that are going to be at the Walmarts of the world, and then we’re going to see a very other high end that are going to be sold at the high end grocery stores, the whole food Markets of the world and then those products, also those high end markets high end markets are also going to be in the steak houses.”
Peck is also encouraging ranchers to get out of the commodity market and into a program market, because if a cattleman produces for the commodity market, he has to take the commodity price for his beef.
“You join forces with a Nolan Ryan Natural Beef, or you join forces with a C.A.B., or you join forces with some other program that has the power to carry you along.”