Poor Future Ahead for Beef Producers?

In a story that’s all too familiar to cattlemen across the country, there is rumbling of some challenges ahead.

USDA Livestock Analyst Shayle Shagam said for now, cattle herds are expanding despite dropping prices.

“First of all, we’re looking at lower returns to cow/calf operators which are being pressured by the lower feeder cattle prices.”

There are also poor weather conditions leading to drought in some of the heavy cattle areas which could result in some slowing of the cattle herd expansion.

Shagam said that doesn’t mean producers are slowing down.

“We don’t think it’s going to be enough to convince producers to turn off the taps in terms of the expansion of the sector.”

That could come though through economics and turn 2018 into more of a liquidation and downsizing year in cattle.