Agricultural News
Mexico's Changing Market Giving US Cattle Feeders a Run for Their Money as Competition Grows
Wed, 13 Dec 2017 11:42:20 CST
Over the years, OSU Extension Livestock Market Economist Dr. Derrell Peel has spent a lot of time in Mexico, learning about the cattle industry of that country. He was back there this year meeting with industry leaders and this week offered Radio Oklahoma Ag Network Farm Director Ron Hays an update on the current situation in Mexico's beef markets. Historically, Mexico's cattle markets were largely dependent on our US market demand. But Peel says that is starting to change as Mexico's industry continues to develop.
"This particular trip had a specific focus on a binational conference on agricultural extension - to really work to try to jumpstart or restart extension programming in Mexico that has been interrupted in recent years," Peel said, reporting on this year's progress. "They had a pretty good summer wet season. Pasture conditions were pretty good, though it turned sharply drier towards the end of the rainy season. But in general, from a s cattle industry perspective, producers report that forage conditions and markets have been pretty good."
Obviously, US markets have continued to attract cattle north, Peel says, but domestically Mexico is seeing increased demand as its cattle feeding sector grows. This domestic growth has allowed Mexican producers more marketing alternatives to take advantage of for their cattle, especially in the northern region. This of course provides more potential dynamics to appear in the markets, which have in the past been almost exclusively dominated by US feeders. Peel says feeders in the US will now have to compete for cattle supplies from Mexico as they become available. Naturally, this will impact prices here at home into the future.
"Depending on what happens in US markets, we may see at least some modest weakening of prices in the US and if that happens it would be easy for those numbers from Mexico to actually back off just a little bit in 2018," he said. "I don't know that I expect them to change that much but it will be kind of a close balance. So, I think they'll be fairly sensitive to price levels in the US certainly relative to their domestic markets in Mexico."
Listen to Peel and Hays discuss the changing market dynamics between Mexico and the US, 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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