NASHVILLE, TN – The beef cattle industry is bouncing back from the pandemic, and continued progress is expected in 2022. Beef prices are near record high, and consumer and wholesale beef demand are both at 30-year highs as the U.S. and global economy recover.
While drought remains a significant concern with weather threatening pasture conditions in the Northern Plains and West, strong demand, combined with higher cattle prices, signal an optimistic future for the beef industry, according to CattleFax.
At the popular CattleFax Outlook Seminar, held as part of the 2021 Cattle Industry Convention and NCBA Trade Show in Nashville, CattleFax CEO Randy Blach explained that the cattle market is still dealing with a burdensome supply of market-ready fed cattle. The influence of that supply will diminish as three years of herd liquidation will reduce feedyard placements. As this occurs, the value of calves, feeder cattle and fed cattle will increase several hundred dollars per head over the next few years.
Blach concluded the session with an overall positive outlook, expecting margins to improve as cattle supply tightens and producers gain leverage back from packers and retailers, beef demand to remain solid with expected export growth, and utilization and packing capacity to improve over the next few years. He also noted that the economy has made gains in 2021 and should stay stronger with low interest rates and government stimulus fueling consumer spending.