Jason
Well-known member
In every commodity based industry demand measured at the consumer level is the real driver, not phony supply issues. Yes with lots of demand, a reduction in supply can cause a price spike, but there is always a limit as to how high the consumer will pay for anything. Try to lower production too far and see if you can survive.
OPEC is a prime example of this. With West Texas between $50-$60 why don't they reduce production to drive the price higher? Are they just being generous? No they know if they artificially drive the price higher they will lose consumer demand. Alternate fuel sources will accelerate development. Oil is a finite resource and easier to regulate than cattle which anybody with an acre can have one.
Again we go back to producers need real information to make real descisions on rather than poor me poor me Tyson controls the world.
Producers control the industry until they sell the cattle. Then they pass the control with the cattle. Want to keep control? Keep the cattle.
OPEC is a prime example of this. With West Texas between $50-$60 why don't they reduce production to drive the price higher? Are they just being generous? No they know if they artificially drive the price higher they will lose consumer demand. Alternate fuel sources will accelerate development. Oil is a finite resource and easier to regulate than cattle which anybody with an acre can have one.
Again we go back to producers need real information to make real descisions on rather than poor me poor me Tyson controls the world.
Producers control the industry until they sell the cattle. Then they pass the control with the cattle. Want to keep control? Keep the cattle.