The Beef Market - From The Ground Up

By: Bob French
By: Bob French

“We’ve got demand that has finally turned the corner after two years of going through this global economic chaos. We’re up about 5%, year to date.”

Randy Blach is CEO of a cattle consulting and marketing company.

“We wish we were keeping a few more cows and starting to expand the herd, but that hasn’t happened yet.”

Texas Agrilife Extension livestock specialist Ron Gill says cows are like ranchers’ cash deposits in banks.

“If you look at why cows are sold, the third reason behind some production things is economics. They need cows for money, and so I think we’ve seen some liquidation of cows and these high prices.”
Economic uncertainty also played a role in delaying expansion of the cow herd.

“We lost the export markets in 2003. We didn’t have access to those. We still don’t have full access to those markets yet today. China, being one of the key markets, we still have limited access to Japan. When you connect that with the drought situation we went through, through so much of the entire United States over the last 4 or 5 years. It just hasn’t made a lot of sense to see the expansion take place.”

“Relatively speaking replacement females are just as expensive as the calves are that we’re selling off of them, so it’s all relative.”

Good demand and short supply translates to higher calf prices.

“We believe we’ll see expansion start or we’ll at least see stability come in to the nation’s cow herd during 2011.”

“We’re going to have a sound supply side economics for at least three years.”

“If Mother Nature continues to work with us, and we have the feed resources and the grass resources, we could finally have a good pay day here in the cattle industry.”

And that’s a good thing because it takes money to increase the numbers in your cow herd. I’m Bob French, looking at Brazos Valley agriculture, From The Ground Up.

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