Cattle Ranchers Facing Worries More Cattle Equals Lower Beef Prices

By The | St Louis Post-Dispatch (MO), January 11, 1996 | Go to article overview

Cattle Ranchers Facing Worries More Cattle Equals Lower Beef Prices


The, St Louis Post-Dispatch (MO)


Jerry Adamson, who's been trucking his cattle down to the National Western Stock Show for about 25 years, worries that 1996 will be more chuck roast than sirloin.

Low beef prices and rising production costs are weighing heavily on ranchers like Adamson, who are showing their animals to buyers this week at the annual, 16-day gathering. Adamson sells breeding animals but the concerns also hold for those raising cattle for slaughter. "It's going to be really tough," said Adamson, whose family owns about 2,000 head on the Rocking J ranch in Cody, Neb. "We're only six months into this cattle depression."

The cattleman's loss has been steak lover's gain, however, with beef prices falling on grocery store shelves.

Retail beef, which includes select and other cuts, averaged $2.60 a pound last year vs. $2.66 a pound in 1994, according to the Denver-based National Cattlemen's Association, which cited government figures.

For ranchers, though, cattle prices are expected to remain low at least until late 1996 and perhaps into next year, said Chuck Lambert, the association's chief economist. Part of the reason is simple supply and demand: When there's a large supply of cattle, prices fall.

"We're in the expansive phase of the cattle cycle," Lambert explained. "The cattle numbers have increased and we're facing record supplies of pork and poultry."

Relatively low supply and higher prices typically open the cattle industry's 10-year cycle, with the supply of cattle normally growing at the midpoint. …

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