A Few Thoughts by John Nalivka: How about some good news in the beef industry?
So, I was driving down the highway today heading from Vale, Oregon to the Big Horn Mountains of Wyoming to hunt elk with my old friends. We grew up together in Sheridan. We all went separate ways after high school (45 years ago next year), but we have always kept in pretty close touch. That situation tends to put me in a good mood even if I don’t get an elk. Of course, success in the hunt always caps off a good time with old friends. So with plenty of time to think and the right mood, a positive aspect of the beef industry was fitting, particularly in light of the market situation.
Carrie Stadheim called to discuss this week’s announcement that the Agricultural Marketing Service (AMS) began reporting prices for cattle traded on the Fed Cattle Exchange. The Fed Cattle Exchange is owned by Superior Livestock and uses an online platform. The video marketing of feeder cattle and calves began over two decades ago and continues to grow so the addition of the online format for marketing fed cattle was a natural extension of that success.
Thus far, the negotiated trading on the Fed Cattle Exchange represents only about 1½ – 2 percent of the trade which admittedly is small and a first response to the announcement might be that won’t add much to the reporting of negotiated trades on fed cattle. After all, too few trades has been the criticism for a long time. It is pretty difficult to find fault with that criticism. But, the other response can be that it is a start in improving the reporting of negotiated prices for fed cattle trades. Mandatory price reporting itself was a start at improving AMS’s price reporting and I think we can all agree it has been generally successful. And, I would submit that after analyzing markets for over 30 years through a great deal of change, market reporting for all commodities in the United States is still the best of any country in the world.
A final note on beef markets; there is no doubt the industry is in for a challenge over the next 2 or 3 years as total per capita meat supplies increase and likely surpass the previous record set in 2007. However, in a relatively short time, the industry has dramatically improved the beef produced and offered to consumers by nearly every measure. Just look at the percentage of carcasses grading Choice and feel good about your industry!