Agricultural News
Retail Beef Demand Data Reinforces the Significance of Demand Growth's Role in Today's Markets
Tue, 03 Oct 2017 10:50:56 CDT
Here in 2017, cattle prices have been much stronger than anyone might have expected them to be - whether you are talking about feedlot cattle, yearlings or even calves. According to Dr. Glynn Tonsor, extension beef cattle specialist at Kansas State University, who spoke with Radio Oklahoma Ag Network Farm Director Ron Hays, says his most recent work studying beef demand, indicates it is in fact the strength and growth of both our international and domestic beef demand that has supported prices - even as supplies continue to rise.
"Basically, we have updated grocery store retail beef demand indexes for the first six months of 2017, and the story is very strong there," Tonsor said. "Across the board, grocery store retail beef demand, is stronger than it was back in November of 2016."
In boiling this data down, Tonsor says his message is reinforced by the numbers and the observations of others in the industry who agree, that the price of cattle would be much lower today, as more and more supply builds up, if it were taking place in the absence of demand growth. As he mentions, supplies are mounting and for the good of the market, Tonsor hopes demand strength will continue to hold par if not grow as we move into 2018 to keep prices supported. He is optimistic this might happen as he recognizes a diverse demand front led by ground beef and loin cuts. He says that is a promising fact, noting the significant differences between the products and the consumer segments involved in those purchases, essentially saying that there is more than one product paying the bill.
"It's important to remember that demand strength," he said. "That's really encouraging - that it is going up, not just the volume, but demand. So, we're getting higher prices than we expect, given the higher volume we see being produced."
Listen to Ron Hays and Glynn Tonsor speak about the current demand strength for beef which has helped to support cattle prices in the face of growing supplies, on today's Beef Buzz.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network and is 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.
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