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Cattlemen Given Signals to ‘Hang Tough’

July 30, 2012
 
 

Source: National Cattlemen's Beef Association

In recent history, drought has been isolated to various regions of the country, rather than a widespread drought threatening most of the country. Last year, for example, drought was centered primarily in the Southern Plains. According to Kevin Good, senior market analyst for CattleFax, 70 percent of the U.S. cattle inventory is located in regions of drought.

"The widespread drought has ultimately led to the worst pasture conditions in the past 15 years," said Good. "The U.S. calf crop is down 800,000 head. The bottom-line, when all is said and done, the cattle herd will decrease by about 500,000 head. This is compared to a 900,000 decrease a year ago, so we are seeing a liquidation but at a slower pace than last year."

Despite the obvious challenges facing America’s cattlemen and women, Good offered reason for optimism. Consumer demand remains strong with solid retail and foodservice sales. As consumers continue to demand nutritious beef, cattlemen are given reason to remain in the cattle business and avoid liquidation. National Cattlemen’s Beef Association (NCBA) CEO Forrest Roberts said the challenges cattlemen are facing are serious, but we are encouraging them to trust the market signals and maintain cowherds if possible.

"The thing we have to remember is that consumers continue to prefer beef on the dinner table. Consumers are sending very clear signs to cattlemen to hang tough and continue producing the protein they prefer most," said Roberts. "There is no doubt this will be tough. But cattlemen are tough people and I am confident we will weather this storm and rebuild the U.S. cowherd once weather conditions improve."

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