Page 12 - MWC 10-27-2022s

FARMERS FACE The Midwest Cattleman · October 27, 2022 · P12
continued from page 3
ebbs and flows throughout of the Choice re-
the cattle and beef market- tail beef value
ing chain regarding market thus far this year,
leverage and relative pric- that spread has in-
es. When feedlots are chas- creased by 96 cents
ing a relatively tight supply per pound relative
of available feeder animals, to before the pan-
feeder prices tend to outper- demic. Meanwhile
form fed-steer values (think the wholesale-farm
late 2014 and most of 2015). spread is 24 cents
When the number of finished higher.
cattle in feedlots strains Comparing the
available beef processing ca- three most recent
pacity, processing margins months of data
increase. (J une-August)
Now that we are about to the same pe-
2½ years removed from riod of 2019, the
the extreme turmoil that retail-wholesale
the COVID-19 pandemic spread is 88 cents higher, inflationary pressures ease, the percentage of retail dol-
wrought upon the cattle and while the wholesale-farm but that chances for return- lars reaching the farm level
beef supply chain, it is in- spread is up 7 cents. ing anywhere near pre-pan- will struggle relative to the
structive to consider how re- The retail-wholesale beef demic levels are slim. pre-pandemic average.
cent marketing margins have spread tends to be more af- Consumer beef demand Brown is a livestock econ-
changed relative to before fected by general macro- has recently proven very omist with the University of
the pandemic, and what the economic factors than the resilient, and there is still Missouri. He grew up on a di-
continued evolution of these wholesale-farm spread. optimism that tight cat- versified farm in northwest
margins might look like in Supply chain pressure tle supplies in the next few Missouri.
the years to come. With labor, energy, trans- years will provide further FarmProgress.com
Retail price analysis portation, and packaging price increases to producers.
Margins during 2020 and costs much higher today than But as costs for everyone in
2021 were omitted from the pre-pandemic levels, it is not the beef supply chain have
graphic below because of the surprising that retail-whole- risen sharply since 2019,
extreme nature of events that sale spreads for many com-
affected them during this pe- modities have increased. But
www.powerflexfence.com.powerflexfence.com
riod. Although typical supply how likely are they to return www
and demand forces were also to pre-pandemic levels?
at work during this time, ex- Examining annual USDA
ternal shocks to the system data on the beef retail-whole-
because of the pandemic sale spread from 1970-2019,
often overwhelmed normal there have been 14 out of 49
market responses, and hope- years when this spread did
fully, they are not repeated decrease amid its general
anytime soon. upward trend. However, the
When we compare the largest percentage decline
first eight months of 2022 to relative to a prior peak has
the same period of 2019, we been 10%, with declines typi- P
PowerPostowerPost
NEWW Taragate Geared 3:1 Reel Taragate Geared 3:1 Reel
are in a much different sit- cally smaller than 6%. NE
holds up t
uation today with the beef This provides some opti- holds up to 1320’ PolyBraido 1320’ PolyBraid
retail-wholesale spread. Ac- mism that the spread could
counting for $3.61 per pound work lower if macroeconomic
6th Annual Fall Highland

Cattle Auction

Saturday, December 3, 2022 • 10 AM Join Us on Facebook

New Location: Springfield Livestock Marketing Center,
Powerflex owerflex
Int 44 exit 70 Springfield, MO P
www.highlandauction.com Polyoly
P
Productsroducts
Selling Registered, Unregistered and Crossbred DVAuctions P
Portable Ends/Cornersortable Ends/Corners
Highlands Bulls, Cows, Heifers, Cow/Calf Pairs, Steers P
Self Driving - in & outelf Driving - in & out
www.heartlandhighlandcattleassociation.org online S Simply the B
Simply the Best!est!
bidding
For more information: available
Check our w
www.highlandauction.com Check our website for ebsite for NEW ProductsNEW Products & & Monthly SpecialsMonthly Specials!!
Order On-Line 24/7 • FREE Catalogder On-Line 24/7 • FREE Catalog
417.345.0575 • text 417.733.3201 Or
heartlandhighlandcattle@gmail.com 417-741-1230 • info@powerflexfence.com
Highland Cattle Registry
Heartland Highland Cattle
Association & Registry
Open Registry for Foundation Highlands
For more info and a free information packet
417.345.0575 or text 417.733.3201
heartlandhighlandcattle@gmail.com
hhcaregistry@gmail.com