Beef Buzz News
Randy Blach Convinced Free Market Will Serve Cattle Producers Best
Wed, 27 Oct 2021 10:40:25 CDT
Leverage is like the Holy Grail in the U.S. beef cattle industry; It has been eluding cattle producers for some time now. CattleFax CEO Randy Blach told Radio Oklahoma Ag Network Director Ron Hays that the problem is, the industry is struggling to get current.
Listen to Ron's conversation with Randy here.
Thanks to the ongoing effects of the COVID-19 pandemic, the U.S. has more cattle ready to be slaughtered than processors can work through. This bottleneck of cattle at the processing step of the supply chain has been affecting the market since the Holcomb, Kan. beef processing facility fire in 2019. Industry experts keep reassuring producers that the situation is correcting itself, but that is taking longer than expected.
“It may still take several more months,” Blach said. “When it does turn, it will turn pretty rapidly and the market will go by us.”
Blach said this is not the time to become pessimistic.
While the industry creeps toward balance, Congress is making moves to artificially speed up the process through the Cattle Contract Library Act of 2021.
“This industry has been a free-market industry for a long period of time,” Blach said. “There are times when we did not like the way it went and there were times we did. I think the bottom line is, I think we need to stick to our knitting.”
The markets will (and are) correcting themselves. Blach reminded folks that when the COVID-19 pandemic hit, the cattle industry was recording peak cyclical cattle numbers.
“When it hit, we backlogged one-million head of cattle and one-million head of feeder cattle,” Blach said. “It just takes forever to work through those kinds of supply situations.”
Blach said he is optimistic that supply will begin to reflect demand.
Click on the LISTEN BAR below to hear more from Ron Hays and Randy Blach as they talk about market leverage in the U.S. beef cattle industry and what a typical premium price is going for now. Yesterday, he and Hays talked about estimated cash cattle prices, check that out here.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR below for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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