A Few Thoughts by John Nalivka – the focus on cattle and climate change
We spend a great deal of time analyzing the cattle cycle and the factors that impact the decisions to build or cull down cattle herds in the U.S. I always preface my comments with regard to the cattle cycle that it’s all about forage availability and making or losing money in the cow-calf business. The cow-calf operation is where it all begins and numerous events, anticipated or unforeseen, short term or long term, can and will occur to change the status quo. Just over the past 12 months, we have dealt with COVID, severe winter weather, and second-guessing China buying in U.S. commodity markets. Those three factors alone are enough to keep any market economist busy. However, this current situation is short term and almost minor when looking at another event that could have much greater impact on beef production – the focus on climate change and cattle.
I will get right to the point. After reading Bill Gate’s interview in MIT Technology Review concerning “synthetic beef”, if my business was raising cattle and producing beef, I think that I would become a little more than concerned about the longevity of my business. To quote Gates in this article, “I do think all rich countries should move to 100% synthetic beef. You can get used to the taste difference, and the claim is they’re going to make it taste even better over time”. Furthermore, he commented, “eventually, that green premium is modest enough that you can sort of change the [behavior of] people or use regulation to totally shift the demand.”
Gates does concede that U.S. beef production is highly efficient so carbon emissions are less per pound of beef produced which is not the case in developing countries. We tout that single true statement with “keep up the good work!” Gates follows that true statement with rich countries should move toward 100% synthetic meat. So, if you are efficient at producing food and helping to feed the world, then you shouldn’t do it anymore? I am confused.
I will respond with my question to cattlemen regarding that quote – after working all of your life to build a business that provides a solid nutritional product to U.S. and global consumers, will you get used to having your livelihood taken away because someone might “get used to the taste difference” or a bureaucrat could use “regulation to change demand?”
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