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Trepidation in the cattle industry continues as price volatility persists

The vice president of government affairs for the National Cattlemen’s Beef Association says the recent volatility in the markets has likely halted any widespread expansion to the cattle herd. Ethan Lane says for the first time in recent memory, cattle producers were more comfortable financially.  “Given these prices, we probably ought to grow a little bit in the next couple years,” he says. “And then they were told for several weeks at a time that they make too much money on their cattle and that they need to lower prices.” 

He tells Brownfield instead of heifer retention, “We’re concerned it probably led to more sell-off rather than increased retention, which is what we were hoping for at this point in the cycle.”

Lane says there is trepidation in the industry, and it has probably impacted management decisions of younger producers.  “What about that 28-year-old producer that just broke off from their family’s operation and have their own herd and are leasing some ground,” he says.  “Where’s their head at, right? Because they’re looking at the next 5, 10, 20 years and what they want their herd to look like and what decisions are they making based on that.”

The USDA’s Cattle Inventory report, which is set to be released in late January, will be the next opportunity to see if producers have started to implement herd expansion plans.

AUDIO: Ethan Lane, National Cattlemen’s Beef Association from NAFB’s Trade Talk