Record cattle and beef prices can be attributed to the nation's shrinking cattle herd, but beef demand is also key factor influencing prices. Speaking at the recent Oklahoma Cattlemen's Association Annual Convention in Midwest City, Okla., Livestock Marketing Information Center Director Jim Robb says international beef demand for US beef is growing.
"We look at these consumers overseas and depends on the world economy, but some of our strongest markets recently have been somewhat Japan, Mexico, Canada," Robb said. "These are pretty favorable markets at this point and time, so as the world economy is really driving that and beef is still a rather preferred item around the world, but those international consumers many of them are more price sensitive than US consumers are, so there is a little more risk in that market place."
Currently the US is also seeing a growing amount of international beef imports. Robb says that can be attributed to the strong US beef prices. Additionally the drought in Australia, he says that is allowing some of the imports to be at these levels.
"Some of it is drought related, but with our cow kill pulling back as dramatically it had recently, we need that lean product to come into our manufactured beef markets and our hamburger markets," Robb said. "We're really pulling that product in and we're see cutter cow values record high, so I think this whole puzzle really does fit together and it really is being driven by this demand profile."
There are lots of signs encouraging producers to begin herd expansion. Robb says he feels the nation is really at a transition point this summer, where producers are starting to hold back heifers.
"We have to restock a lot ranches that have been destocked with drought in recent years," Robb said. "There are still a lot of pockets in the US that are still struggling, but I think we look at the national perspective we're in the transition point in time and we're clearly stabilizing the size of the beef cow herd."
Click here to see more...