Posted April 30, 2014
Cow-calf ranchers are seeing an increase in profits and decreasing herd numbers, according to an article by Politico available here.
“The prices are as good as I have ever seen,” says Myron Williams, a 66-year-old South Dakota rancher who has been in the cattle business since the late 1960s. Net returns for cow-calf operations for 2014-2015 will “run 35 percent higher in real dollars than the previous peak” in 2004-2005, according to projections by the University of Missouri’s Food and Agricultural Policy Research Institute.
Recent survey data from USDA shows that “84 percent of the beef cows in America are still in herds of 500 head or fewer.” While the industry has seen concentration, “cow-calf ranches are the irreplaceable seed corn – and retain a level of individuality that stands out.”
The next few years will “require a significant retrenchment with more plants closed and high prices for American consumers.” Growing the cattle herd is, however, a slow process, that “adds up to a fascinating but immensely intricate supply-and-demand story about what’s really a bit of Americana.”
International trade and the growing market in Asia are also helping to sustain higher prices for beef.
For more information on agricultural economics and international trade, please visit the National Agricultural Law Center’s website here.
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