Cow/calf producers in the driver's seat?

Jan 27, 2012
by WLJ

Wow, what a time at the Range Beef Cow Symposium in Nebraska this year. You could almost use the song title “The Future’s so Bright, I gotta Wear Shades,” by Timbuk3. One of the speakers I really enjoyed hearing at the symposium, which took place Nov. 29 to Dec. 1 in Mitchell, NE, was Jim Robb from the Livestock Marketing Information Center, Denver, CO.

Robb started his presentation with the fact that by 2030, there will be 33 percent more people in the world to feed and that we will have to double the amount of animalbased protein to get this all accomplished. To be able to accomplish this challenge, our industry will need to enhance technology. Robb focused his presentation on the steps facing the industry in the near future.

“Between the increase in global demand for ‘high quality beef’ [in which the U.S. is the number one exporter of ‘high quality beef’] and the fact that a quarter of the beef industry is in severe drought, the decrease in supply will result in an increase in de mand,” said Robb.

Robb stated that the cow slaughter levels in the region mean that beef cow numbers nationally might be down another 2 percent by January 2012 to 30.25 million head. He also said that 2015 will be the first shot that we have in increasing the cow herd size.

What does that mean for cow/calf producers in the mean time? You have a product that is in demand with short supply. It was mentioned by Tom Brink, J & F Oklahoma Holdings, who also spoke at the Range Beef Cow Symposium saying that for the first time, cow/calf producers are going to be in the driver’s seat.

With 300,000 head of heifers needed just to stabilize the U.S. cow herd numbers, Robb predicts cow/calf pairs could bring $500-$1,000 more this summer and into the fall next year and that heifer calves could bring a premium over steer calves. This, of course, is all dependent on the fact that nothing drastic changes in the markets, that the European Union stabilizes, and that Texas starts heading out of the drought. There are always factors that can and do change the course of markets, but for right now, our future’s so bright, we gotta wear shades. — Heather Larson, South Dakota State University