Economist: Cattle industry will prevail despite a rough couple of years
One economist believes that though people are changing their spending habits, the current herd contraction will continue.
The past couple of years have been challenging the cattle industry, and one economist says some of those have supported a better outlook for the future.
Lance Zimmerman is a beef industry research analyst with Rabobank. He says while the nation endured a two-year stretch under the grasp of a global pandemic, both the cattle producer and consumer were and still are, victims of the supply chain.
“Today, with the recessionary pressures that exist, the U.S. consumer is much more cautious. They’ve pulled back their purse strings, they’re being more measured how they spend their dollar today,” said Zimmerman.
He said that is translated into a consumer that has migrated from food service to quick service. When it comes to the future, Zimmerman anticipates the current herd contraction will continue nationwide.
“But I do believe that the tighter cattle numbers and the liquidation that we went through since the 2019 highs, we’ve got a lot of cattle producers who could enjoy some prosperity, at a level we haven’t seen for at least three years, certainly for many that haven’t seen in five years or more. So, I think that it’s an exciting time when you look at the global markets as well, they’re going to offer a lot of opportunities down the road for us. Our consumer basis is pretty mature, so the best opportunity to grow our consumer base is outside of the United States, and that’s going to have to continue to be a focus for us going forward,” Zimmerman said.