Nebraska Cattlemen has sent a letter to Nebraska’s congressional delegation laying out a plan of short-term and long-term action items to address current and future cattle market issues.
“Because of the rapidly increasing spread between boxed beef prices and live cattle prices over the past week, our first priority is to demand USDA increase monitoring of price action and buyer behavior at the feedlot-packer interface and take swift action if undue price manipulation is discovered,” said Ken Herz, Nebraska Cattlemen president.
Nebraska’s top industry officially asked for the following relief in the wake of the COVID-19 pandemic:
— A one-time “Beef Stimulus” payment for cattlemen and women who have dealt with rapid market decline and continued extreme volatility. This payment can and should be used to help cattlemen weather the extreme drain on whole farm/ranch equity.
— Exploration of modifications to current and/or new risk mitigation programs to increase affordability and participation.
— Ensuring that the U.S. Department of Agriculture and other federal agencies remain operational to keep packing and processing facilities operational to allow entities further down the beef production chain the ability to keep marketing cattle.
— Exploration of ideas to incentivize more cattle to be marketed on the cash market, thereby increasing true price discovery and transparency in the marketplace. NC policy encourages cash negotiated trade levels reach 50% of fed cattle marketed.
— A USDA increase in monitoring of packer bids and take swift action if undue price manipulation exists.
Herz said Nebraska Cattlemen staff and leaders remain in daily communications with elected officials on the state and federal levels, as well as governmental agencies on the local, state and federal level to ensure that cattlemen’s business continuity is a top priority.
The coronavirus is dominating news headlines, including those related to global trade, according to the U.S. Meat Export Federation.
Federation President and CEO Dan Halstrom said the virus has had an impact on red meat exports, but a number of supply and demand fundamentals and market access improvements have underpinned continued strong export volumes.
“The first quarantine actions in China were taken in late January and the calendar had turned to February before coronavirus became a major health concern in countries such as South Korea and Japan,” Halstrom said. “But despite logistical challenges, a severe decline in tourism and a notable impact on sit-down dining, overall demand for red meat in these markets is quite resilient. Retail meat sales have remained strong and both retailers and restaurateurs are utilizing e-commerce and delivery services at unprecedented levels. While it’s definitely a challenging situation, the Asian food industry is adapting to these conditions and finding creative ways to accommodate consumers.”
After a record-breaking performance in 2019, U.S. pork exports were still going strong in January, according to data released by USDA and compiled by the federation. January beef exports were also higher year-over-year, while exports of U.S. lamb trended lower.
January pork exports cooled slightly from the volume and value records established in December 2019, but still far exceeded year-ago levels. Both the January export volume of 273,603 metric tons (mt), up 36% year-over-year, and export value ($738.7 million, up 50%) were the second highest on record. Export value per head slaughtered was $62.53, up 40% from a year ago. Exports accounted for 29.8% of total pork production and 27.4% for muscle cuts only, up substantially from last January’s percentages (23.6% and 20.3%, respectively).
Beef exports posted more modest growth in January, increasing 2.5% from a year ago in volume (107,374 mt) and 5% in value ($672.7 million). But beef muscle cut exports were the highest ever for the month of January at 81,342 mt, up 4% from a year ago, while muscle cut value increased 5% to $589.2 million. Export value per head of fed slaughter was $302.93, up 3% from a year ago. Exports accounted for 13.1% of total beef production, down slightly from a year ago, and 10.6% for muscle cuts only (steady with January 2019).