This four-part series on ranching voices will cover everything from packer concerns to labeling beef to the checkoff and so much more. And while there are many schools of thought on these hot topics, my intent is to present some of the chatter that is happening and let you decide what you think is the best route moving forward is for the independent beef producer.
Today’s blog will recap a speech presented by Corbitt Wall, commercial cattle manager and livestock market analyst for DV Auctions, who was the keynote speaker at an inaugural event hosted by the newly organized group, the Foothills Cattle Producers. More than 300 producers gathered to discuss their concerns.
In case you missed the first segment, read it here: How can producers take back control?
In Wall’s speech, he offered some hard truths that were somewhat difficult to swallow but really showcased what producers are dealing with right now.
Waxing poetic about days gone by when cattle buyers dressed in three-piece suits and top hats to look through cattle in the stockyards, Wall said that today when you drop off your cattle at the sale barn, you might be greeted by someone in a cutoff t-shirt and flip flops.
And as the pomp and circumstance of selling cattle has gone by the wayside, so, too, have producer options as consolidation in the feedlot sector and fewer packers with less competition to negotiate with.
“There are just a few packers playing, and they do almost all of the business,” said Wall. “And mandatory price reporting isn’t as good as what it was and what it should be. And then with the fire at the Tyson plant in Kansas, we found out just how truly vulnerable we really are. Ranchers don’t have any leverage anymore. It’s a sad situation. So much of our industry is relying on the cash fat cattle price, and then whenever a catastrophe hits, the cowboy is left dealing with the aftermath.”
He warned of the dangers of the beef industry going by the wayside just like dairy and pork production, where independent ranchers would be replaced with hired employees for major corporations.
“Are you catching my drift?” he asked. “They won’t need your ranch. You can either sell it to someone who loves to hunt or get a conservation deal. Let’s face it. There’s no land you can acquire and pay for with cattle. We are just hanging on with the equity bought by our forefathers.”
Factor in, fake meats, he said, which are much more than another competing protein source, and it’s a combination of overwhelming factors that may have many producers exiting the business in the upcoming years.
“Beyond Meat’s mission statement is to eliminate farm animals form protein production,” he said. “They have a steer on their logo to make us mad. They aren’t going after vegans; they are going after us. You can’t watch a football game on TV without seeing a Beyond Meat commercial. Every single episode of ‘Yellowstone’ has a fake meat ad on it. They want us to accept it, just like society has accepted fake dairy producers. And at first we laughed and said, ‘How can you milk an almond?’ Now, these fake dairy marketers have almost 15% of the market share. We can’t afford this to happen to the beef industry. We have to fight it with every ounce of fight we have.”
In his speech, Wall wasn’t all doom and gloom though; his second half focused on what the beef producer can look forward to in the New Year.
“China is getting hungry, and when President Trump signs this new trade deal on Jan. 14, they will start buying protein from us,” said Wall. “Why else would China do this deal with the United States? They will starve if they don’t, and once they start getting a taste of what the sweet beef we produce tastes like, lookout. We may just not have enough cows to keep up with demand!”
Wall credited President Trump for shaking things up and working hard to get the upper hand in every trade negotiation that happens, and recent export wins in Asia are going to be huge for the American beef producer.
“Every U.S. president for the last 40-50 years has tiptoed around China; they didn’t know how to negotiate with them,” said Wall. “Then along comes Trump, and he puts a big yellow hot shot to them. They can’t fathom that he is bold enough, but now we have China back, and we’ve got Japan back, too.”
As trade deals shake loose and the United States gears up for a U.S. Presidential election, there are a lot of factors that could help or hurt the American beef producer in the year ahead. So what are ranchers supposed to do today to paint a bright future for tomorrow?
“Stop being idiots!” said Wall. “Stop selling your cattle without some say in what they bring. Don’t give up your leverage. Take advantage of marketing cooperatives to sell your calves. Quit selling off last week’s average sale barn price.”
In closing, Wall left producers with a little bit of good news and a brighter outlook to think about.
“We have reasons to be bullish,” he said. “Total cattle slaughter was up 2.5%, and heifer slaughter was up 6.5% in 2018. In 2019, heifer slaughter was up 8.6% and cows were up 11.6%.”
Combine that with a tough year for weather in 2019 meaning fewer calves are on the ground, and add in that beef exports are up 15% in 2019 with the new sheriff (Trump) in charge, and Wall says the industry is gearing up for solid markets in the spring of 2020 and with the peak to arrive in the spring of 2021.
Hopefully, this recap gave you some things to mull over. Tomorrow, I’ll unveil part three in the Ranching Voices Series, where we’ll hear from Suzy Geppert, South Dakota Beef Industry Council executive director, who will debunk some common misconceptions about the Beef Checkoff. Stay tuned!
The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Farm Progress.