Area Cattle Producers Facing Tough Economic Times

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(Le Mars) — May is recognized as “Beef Month,” and with Memorial Day approaching, we normally think of it as the start to the outdoor grilling season.   Two items that usually have a smile on cattle producers faces.  However, cattle producers are feeling depressed and disappointed this year, and it has much to do with the COVID-19 virus outbreak. Craig Anderson feeds cattle near Merrill. He says the virus outbreak has disrupted the food chain system, causing cattle to be held at the feedlot longer,
instead of being transported to meat processing facilities. He says it is a supply and demand situation.

Anderson describes the working conditions at a meat processing facility, and why the coronavirus is likely to affect so many employees.

Anderson says cattle are being held at the feedlots longer and are getting heavier, and are not as desirable to the meat processor, and consequently costing producers money. First, with the added feed, and second, with the discounted bid price. Cattle producers, like himself, are losing money with every head of cattle sold to the packing industry. He says cattle had been
trading at around a dollar per pound.

The Plymouth County cattle producer says with the restaurant industry also having to shut down, or running now at only 50 percent capacity, it also has hurt the cattle producer’s financial bottom line.

Anderson estimates the cattle industry is running between 30 and 40 days behind in having cattle marketed on a current basis. He says during that time, cattle may gain around three to four pounds a day, which will add around another 100 to 150 pounds to their market weight. President Trump has ordered an investigation into the meat processing industry because of the
wide profit margin between what the producer is paid, and what the consumer is ultimately paying. Anderson says the reduction of competition within the meat processing industry, has led to suspicions of collusion within the packers.

Anderson says Congress is trying to re-establish an open trade, and make sure independent cattle producers have a real market place, instead of a bunch of formulas with different packers. He says packers are wanting to operate as efficiently as they can. Anderson says he is hopeful the COVID-19 virus will
begin to disappear, and that Memorial Day and the summer grilling will help the demand for beef, and stabilize the marketplace.