“If you feed cattle, the cost of gain is what it takes to put a pound of gain on a yearling in the feed yard and has gone up from basically fifty cents up to seventy five or eighty cents.”
And that translates to an average input increase of about one hundred twenty five dollars per feeder animal, which negatively impacts the price a rancher gets for his calves that are headed to a feed yard.
“We’ve got to back that up out of what we give for a feeder, so it’s not hard to figure when you figure a six hundred pound feeder steer going on feed, you’ve got to buy him for $20 a hundred cheaper than you did six months ago.”
And that will cause a reduction in the size of the U.S. cattle herd.
“Eventually you will put enough strain on some people that some of them will look at either liquidating their herds or trying to cut back enough that they can be more self sufficient on whatever ranch that they have and not have to buy as much hay and as much feed and whatever.”
And if the demand for grain to fuel ethanol plants continues?
“We’re going to produce less protein here in the U.S., which eventually will make for higher food costs. I think it will make for higher pork, poultry, and beef products in the future, so I think people are going to either have higher food costs or higher food costs.”
Some ethanol experts believe bio mass technology to produce ethanol is only five years behind current technology using corn.
“That all may happen, but I tell you we’ve got to worry about today and tomorrow, and then we’ll worry about five years down the road then, but we’ve got to worry about today, today.”
I’m Joe Brown, looking at the journey our food makes from the farm to our tables, From the Ground Up.