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Are reatailers to blame more than Packers and Imports

Murgen

Well-known member
The third most important factor on
cattle price variability is packer-to retail marketing costs. Marketing
cost effects on fed and feeder cattle prices were $2.85/cwt and $4.66/cwt,
respectively. This result emphasizes the importance of costs incurred by
livestock-meat marketing firms. Studies have shown, for example,
that technology adoption by meat packers and cattle finishers increases
cost efficiencies. This has resulted in increasing input demand, hence,
prices paid for fed cattle and feeder cattle by meat packers and feedlots

(Brester and Marsh 2002). The remaining factors demonstrated
smaller effects on cattle prices. The trade effects, which usually receive
much public attention, are relatively small. The market share of net live
cattle and beef imports (carcass weight) averaged about 7 percent of
total U.S. beef supplies (production, stocks, and imports) for the 1980-
2002 period. The trade impact on fed and feeder cattle prices amounted
to about $1.51/cwt and $2.48/cwt, respectively. For 1200 pound fed
steers and 650 pound feeder steers, this was equivalent to about $18 and $16 respectively.
 

Jason

Well-known member
This just shows where the costs are higher.

Retailing beef isn't cheap. Live cattle can be held an extra week (or more), beef has a definate expiry date.

Feeders and packers are very focused on specific costs and have been able to streamline their operations to a great extent. The retailer has to deal with the whims and preferences of consumers.

Utility bills go up and maybe they skip the beef section at the store that week. Kids break their arm and the doctor bills force a reduced budget for 6 weeks. So many variables exist at the retail level.

I was able to sell 2 halves of beef back in January just because Alberta sent out $400 oil revenue cheques to each person. If those cheques didn't come the beef wouldn't have moved.
 

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