Current hardships facing the cattle industry: drought and market concentration

Wednesday’s USDA reports were good for crop growers, an ag economist calls it another setback for livestock producers.

They are already facing high feed costs.

Iowa State Extension economist, Chad Hart tells Brownfield Ag News that some range and pasture lands have taken a beating from drought, and they can expect to pay even more for supplemental feed over the next several months.

Another hardship facing cattle producers-- market concentration.

Lawmakers may be looking at more packing capacity, not more regulation, to help ease the situation.

Last week, the Senate Ag Committee heard from producers who are getting rock bottom prices for their cattle, while beef prices reach record highs. Some Senators want the government to force competition by upping negotiated cash pricing to half of all cattle sales. Others want flexibility in trades.

Republican Mike Braun of Indiana says that ultimately, there must be more players in the market.

“More entities within all fields of enterprise and competition, and we’ve got to make sure that we have policies here in place that don’t encourage just a few in any given sector,” Sen. Braun explains. “That’s when you get oligopolies, you get prices going up, never coming down, and it’s not true competition.”

There is no timetable for new legislation from last week’s hearing. Ag Secretary Tom Vilsack recently announced a $55 billion dollar grant program to help small processors qualify for federal inspection.


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