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Will The US Cattle Prices Last?

29 October 2014

US - US cattle farmers enjoying record high beef prices have one concern – competition from other proteins come spring 2015.

Latest analyst insights suggest there is no major slump in prices on the cards but that a regenerated pig and poultry sector may weaken prices as consumers have ready alternatives.

In the meantime, youngstock numbers will remain tight until 2016, when one Agricultural Economist says the balance will begin to resume.

Beef herds are rebuilding and studies going back to the mid 1800’s show that this is when prices hit their peak, according to Professor Chris Hurt, Purdue University.

“There are two reasons for this,” Professor Hurt explained.

“First, the number of market ready animals is already small due to the contraction that has been going on; and second, the retention of heifers and cows further reduces slaughter animal numbers even more thus pulling down beef supplies.”

This year’s figures show that retention has taken 1.7 million females of the market, with even dairy cow numbers falling.

“The milk industry has also likely begun an expansion phase,” added Professor Hurt.

Overall, this means five per cent lower slaughter for the year, with figures showing that heifer retention is a growing phenomenon.

In the present climate, farmers are advised to maximise their returns, with some producers guilty of ‘panic-selling’ recently.

This is according to Professor Roy Burris, University of Kentucky, who recommends preconditioning calves to make sure as many as possible make it to adulthood.

"Folks that are buying expensive calves will want some assurance that calves have been properly immunized and managed - so that they have an edge on survival,” said Professor Burris.

Similarly, cows need taking care of, and bulls should be selected for calving ease.

“There is too much at stake,” he added.

“Feed costs might even be falling a little - at least it seems that corn will be cheaper this fall. Keep those cows in proper condition for good breeding efficiency.

“This coming winter will be a very important time for your cattle operation. There's no excuse for "roughing" cattle through and hoping that the next calving and breeding seasons will work out okay.”

Discussing beef prices, he said farmers should not be waiting for the rug to be pulled from underneath them, he added.

Strong cattle prices should be enjoyed and made the most of.

Michael Priestley

Michael Priestley
News Team - Editor

Mainly production and market stories on ruminants sector. Works closely with sustainability consultants at FAI Farms

 

Top image via Shutterstock



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