Some optimism for cattle prices
A Purdue University economist says help for cattle prices should be on the way.
Chris Hurt lists several reason for his optimism. For starters, finished cattle prices tend to move upward as the weather cools late in the summer. And he says cattle slaughter will remain moderate with small supplies coming out of feedlots this fall.
Hurt also points to competitive pork and poultry supplies, which will be down three percent the last half of 2009. And, most importantly he says, consumers are beginning to see signs of improvement in the general economy, which should mean improved domestic beef demand.
In an interview with Brownfield, Henderson, Nebraska cattle feeder Alan Janzen agreed that the situation is starting to improve.
“We’ve seen the volatility come out some,” says Janzen. “The cost of feeds have come down. Cattle have been marginally profitable over the last three to four months, either side of breakeven, considerably better than what we saw earlier this year and most of ’08.”
But Purdue’s Hurt says while the worst may be over, the cattle industry, like the general economy, will be slow to recover. He says losses have accumulated, and even though losses won’t be as large this fall, real profits may remain elusive until the spring of 2010.