Days of cheap calves gone, livestock marketers told
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SAN LUIS OBISPO, CAL
The days when cattle
producers could shop the
nation for “cheap calves”
are gone, livestock
economist Edward Uvacek,
Jr., told the recent Livestock
Marketing Congress ‘BO
“There are no more
pockets of cheap calves
around anymore,” Uvacek
said at the opening session of
the Congress, held here and
conducted by Livestock
Merchandising Institute.
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And, he said, “We’re moving
more and more to a national
market for feeder cattle.”
In contrast to the coast-to
coast production of feeder
cattle, Uvacek noted the
“very highly concentrated”
feedlot industry, and said it
had a major impact on the
livestock industry.
Uvacek said 212 feedlots
feed 16,000 or more head of
cattle yearly, or 41 per cent
of the nation’s total.
Of the 212 feedlots, 60 are
owned by 20 firms, he said
Turning to the economic
outlook for the industry,
Uvacek said that although
costs will continue to rise, by
1983 or ’B4 everybody will
want to get back in the in
dustry again because it will
be profitable.
The livestock industry is
now in the second year of the
current cattle cycle, and the
peak of the cycle will
probably come m 1986, he
said.
■w
A relatively slow buildup
in numbers can be expected
from now through 1982, with
the rebuilding peak oc
curring about 1984-85, ac
cording to Uvacek, an
associate professor at Texas
A & M The best prices for
calves should come from
now through 1984, he said.
Although he said the
I 0 mto a
major recession,” Uvacek
said “I don’t think it’ll have
that much impact on meat in
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general.”
He cited the availability of
cheap pork and chicken, and
predicted that consumers
will be substituting cheaper
meats for beef.
He also listed several
elements, outside of normal
supply and demand factors,
which he said are affecting
the livestock industry. These
include
Weather
Futures markets.
“Research has now proven
1 ,r * J
I %! I ' -t L,
I i “ £
vt
that this market
affects cash prices,” he said.
“This is a whole new ball
game and it behooves us to
leam how to use it.”
Trends in beef eating
habits, including the use of
texturized vegetable protein
as an extender, and the
growth of fast food
restaurants. Saying “We
may have peaked out in the
growth of the hamburger
society,” Uvacek added that
fast food growth is now in the
fish and chicken areas.
Decisions made in
Washington, both legislative
and regulatory.
The federal food stamp
program, which pumped $8
billion into demand for food
in 1979
The outlook for the rest of
the year will be much better
than the first part of 1980, he
said, predicting light fed
cattle marketings for the
rest of this year.
Fat cattle in the third
quarter should bring $72-$76
cwt, and $74-$7B cwt. m the
fourth quarter, he said.
If fat cattle do go to $7O
cwt., that may be the
“magic number and feeder
prices will take off,” he
added.
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