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We Have A Situation On Our Hands - Pork And Beef Working To Secure Stability In Supply Chain

Nov 15, 2016

By Steve Meyer,
Meat product economist


For some, the amount of product on the market both in pork and beef, seemed to have piled up rather suddenly. But in fact, it’s been mounting for some time and has more or less been expected, says Steve Meyer, meat product economist. Farm Director Ron Hays spoke with him at the recent National Association of Farm Broadcasters convention about what his outlook is for the future as both protein industries work to move product during this period of growth in both species here in the US.



“It’s been brewing for a long time,” Meyers said. “We started growing hog numbers pretty substantially last year and it’s mainly on the back of productivity. We thought the numbers were coming for some time and not a surprise to us.”

On the beef side though, Meyers tells Hays that the good moisture and grass conditions over the last couple years have encouraged the rebuilding of cattle herds, which he says fits into the cause and effect sequence of events.

“Last year though, pulling those heifers out drove markets extremely high and we’ve slowed that process down,” Meyers said, “and now we’ve got those calves coming out of that larger cow herd and we still have excellent grass conditions so we’re putting a lot of weight on these cattle before the come into the feedlots.”

Meyers attests that the beef side is stabilizing fairly well with support levels seeming to hold enough to allow feedlot operators the chance to make a little profit. On the flip side, though, he says things are not as bright for cow/calf operators who are seeing the prices they had for a short time starting to slide down. But for hogs, Meyers says there is no stability yet as packing capacity is creating constraints within the processing line.
“We think maybe the worst is over but we have really a situation right now where the price is kind of indeterminate,” Meyers said. “Packers have kind of held it in these upper $40 or $50 range and I think that’s going to continue because producers have been very aggressive in their marketings.”

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