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Beefs and Beliefs

Is Our Industry In Decline?

High costs, poor returns make beef industry no country for young men.

Sometime last winter I had an email discussion with John Vogel, editor of the American Agriculturist in the northeastern states about ideas for bringing young producers into the beef industry.

I’ll confess right now I wasn’t very encouraging.

John told me he was on a committee and asked if I had any ideas. I told him I couldn’t see any way it makes sense if a person had to borrow money for land and cattle and that even with my knowledge of grazing and the attendant abilities to run higher stocking rates and get good gains I couldn’t see any way to make it work.

The long and short of it is if you inherit enough land and cattle to be in the cattle business, you’re in. If not, you’re out.

Lately I’ve been thinking about all this again and I’m wondering if we’re an industry in decline. Clearly there will always be lands that can only be grazed and never farmed (thank God).

But this is a tough business any way you look at it.

The drought shaping up in the Southwest is holding us back more.

Oklahoma State University Economist Derrell Peel says beef cow numbers at the beginning of 2011 were down most sharply in Missouri, Iowa, Kentucky, Texas, Louisiana and Oklahoma. He says in the first three states the decline may reflect increasing competition with crop production and long term shifts in beef production away from the region, though it will be some time before such impacts can be confirmed.

“In Texas and Louisiana, the decrease likely reflects continuing drought conditions which have since spread from Louisiana and eastern Texas across much of Texas and parts of Oklahoma, New Mexico and eastern Colorado this year,” he adds.

If this continues we’ll obviously keep cattle numbers low and prices high and that’s a good thing. But some grain-industry analysts are saying corn planting is severely behind pace this year and suggesting we could see new records in corn prices.

If that happens, I’m sure about one thing. We’ll have to change the way we finish cattle even more and corn feeding could become a finishing practice for only the best calves with the greatest potential for the highest money.

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