The price of beef is about to go down, on the hoof and probably in the grocery store.
It has been a well signaled decline, according to market specialists. We will hear from the Livestock Marketing Information Center (LMIC) on what they think lies ahead for a southern drought, cattle entering the lots and the price of fed animals this summer.
AUDIO: Profit Matters 5-31-18
After the U.S. Department of Agriculture (USDA) released its latest Cattle on Feed report, Radio Oklahoma Ag Network associate farm director Carson Horn had the chance to speak with Jim Robb of the Livestock Marketing Information Center about some of the different environmental and economic factors currently influencing the beef markets – including the impact of drought.
?This report definitely shows we placed cattle early, especially out of the Southern Plains, because of drought,? Robb said. ?As we look ahead from this point forward, the drought will start to impact when these calves that are born, weaned and what we do with our summer grazing program. It can continue to influence the feedlot placement much like they have in recent months, but we?ll have to wait and see.?
Robb also addressed the recent fall off in cattle prices that have been observed, especially in respect to finished cattle. While the decline has been fairly strong over the last couple of weeks, he says most of that adjustment was well anticipated. However, he admits it may have come at a faster pace than expected. This has created an incentive to market cattle early.
Even so, Robb says the market is shaping up as anticipated, but cautions that the summer lows are still ahead in June and July, in terms of fed cattle prices. He expects calf and yearling prices, too, have a little ratcheting down left to do. Robb says much of how things play out will depend on the weather and how favorably Mother Nature decides to treat us. That said, Robb believes for the most part, the industry is well positioned to take on whatever challenges may arise during the balance of this year.
?We need to continue to market cattle even though prices will erode here over the next several weeks. If we continue to do that – we set ourselves up for a nice rebound of fed cattle prices in or by the fourth quarter of 2018,? Robb said. ?We need to keep doing what we?re doing on the marketing side and hope for strong movement of beef through the grocery stores and the U.S. economy seems primed to do that.?
