Reduction in beef production could lead to higher prices for producers
A protein analyst says tighter beef supplies on the global market could push prices higher for producers.
Lance Zimmerman with RaboBank North America says the US will lose about 1.5 billion pounds of beef production in 2023. “It will be our first year-over-year decline in beef production of any significant magnitude since the previous cattle cycle when we began the rebuild.”
He tells Brownfield even with the decline, the US will still be the top producer. “We’re going to have growing supplies in Australia. We’re going to have growing supplies in Brazil, and even growing supplies in Mexico albeit on a much smaller scale. But the growth in those three markets won’t be enough to offset the decline in the US.”
And, Zimmerman says, that means US exports could decline. “We think about our partners to the north and south – Canada and Mexico – but then we gravitate overseas to Japan, Korea and China. We’re going to lose some market share there because we won’t be able supply those markets as well.”
He says to meet domestic demand, the US might have to import more beef.