Agricultural News
Peel Calls Pent Up Demand in Beef Business the 'Urge to Grill'
Wed, 08 May 2013 17:02:41 CDT
Across much of the country there has been more winter than spring since the official start of spring and we're moving closer and closer to Memorial Day, the unofficial start of summer. Still, people have not been able to get out and grill even once. According to Livestock Market Economist Dr. Darrell Peel, there's pent up demand out there when it comes to consumers and an "urge to grill."
"I really think the weather had a bigger impact than we might have realized at some point. If you look at population centers, particularly the northeast part of the U.S., they've just been hammered all the way back to the hurricane last fall with one adverse weather event after another. And we're still having some cold-weather things happen here, but I think we're reaching that point where now we're seeing that demand come together. It's combined with other things that are helping demand: gas prices have eased a bit and those things help a little bit as well. And so I think we're just generally set here for some improving beef demand."
Beef production has declined and will continue to decline in the days to come, Peel says.
"Carcass weights are falling. It's a seasonal trend at this time of the year, but what's important is that we're not nearly as much of an increase year over year this year compared to what we were seeing a year ago. We didn't really expect to see that, but it's another one of those factors that we've been watching.
"We're not down as far on beef production so far this year as we might have thought we would be. Slaughter rates have actually been a little stronger and the carcass weights are still up there, but, again, not the kind of premium we had a year ago."
Beef cows are going to the packing plants in pretty good numbers as well, Peel says.
"Beef cow slaughter the last five weeks has been above year-ago levels. We started off the year with a double-digit decrease in cow slaughter that we expected. But the increases in the last four or five weeks we've run an average of about 11 percent increase. And when you put those time periods together year-to-date, we're down to less than three percent year-over-year decrease in beef cow slaughter. It's still down, but it's down fractionally compared to where we thought we might be this time of year. And I think it is a reflection of the fact that a long, cold winter has translated into pushing some producers just past their ability to maintain resources to hold onto these cows. We're out of hay, we're out of equity, we're out of banker-in many cases-and I think we've seen the slaughter rates go up to confirm that."
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network- but is also a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show- and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
WebReadyTM Powered by WireReady® NSI
Top Agricultural News
More Headlines...
