Gentlemen, after reading your articles published May 6 in WLJ, it appears a lot of heat has been created by packer lawsuits. But here are some facts from a cow-calf producer:
First, in the May 6 issue, WLJ published imported feeder cattle from Mexico at 491,948 head of feeders imported from Mexico as of April 20. That number is almost 90,000 head more than last year. Mr. Kay, you stated we have too many cattle in this country. Why are we importing record numbers? What is the tariff on Mexican feeder cattle? How many head of USA cattle has Mexico taken this year? Where do these Mexican cattle enter the food supply?
These are questions I would like answered, if you have them.
Fact: My all natural NHTC 750-pound heifers sold for $136 in January. That topped the market. Steers were $15 higher. Fact: Packers will make $350 per head on each of my calves. My margin was negative on each head, after feed and expenses, not counting my labor.
Mr. Crow, you stated that producers would be insulted if our cattle were called commodities. If that is the case, why are my calf prices determined by what CME publishes as futures prices? On May 9, DTN published futures prices for commodities. With the exception of May hogs and May wheat, all futures were in the red. May feeders closed at $135.77.
Question: What is packer margin at those prices?
I’m not saying we don’t need packers. Where else would my cattle go? However, $350 packer margins and $6.20 per pound retail prices mean the cow-calf guy is getting manure on his hand from holding that proverbial end of the stick. Fact is a lot of cow-calf producers are going out of business. Take a look at the Ag Census from 2017: 3.2 percent fewer farms and ranches than 2012. If something doesn’t change the number of cow-calf ranchers reading your articles will decrease even more.
Personally, I don’t give a rip about a rancher in Brazil, Mexico, and other countries we import cattle from. I challenge you to please provide me with trade numbers from countries exporting cattle to the USA. I am not against trade. I am for fair trade. I just want to see trade balance with other countries.
One last fact: It takes three years for a retained heifer to grow, get pregnant, raise a calf to weaning age, get that calf to slaughter weight, and finally get meat to the consumer. That means the massive herd expansion that caused cattle prices to drop in 2015 started during the drought of 2012 and 2013.
Thanks for allowing me to share a few thoughts. I look forward to hearing from you.
Bill Yancey, Captain USN-RET
[Editor’s Note: The USDA Economic Research Service maintains a fairly user-friendly hub of both meat (beef and veal) and cattle trade data going back to 1989. It can be found at ers.usda.gov/data-products/livestock-and-meat-international-trade-data/ and includes both monthly and annual data on imports and exports of meat and livestock.]