Contraction in the cattle industry continues

“If we don’t change things, we’re going to continue to see a reduction of the herd.” Nebraska cattleman Lee Reichmuth says the days of independent cattle producers are limited if there aren’t some changes made to the cattle industry.

He tells Brownfield while drought has been factor, the extreme financial pressure on cattle producers has also contributed to more liquidation.  “Because if you look at the slaughter of cows throughout the country, in places where they do have grass, they’re reducing numbers,” he says.  “If we don’t change things here, this industry is going to become more consolidated.  We’ve kind of become price takers, not marketers.”

Reichmuth says the market is giving producers mixed signals.  “Producers are receiving the message that we need to reduce supply,” he says.  “And on the other side consumers are seeing prices at record levels outside the pandemic and the market is giving the message to ask for more product.  Obviously the bottleneck then, is the packers.”

He says they’re optimistic some of the recent moves to increase competition and price transparency in the markets will help the cattle industry survive.

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