National Cattlemen's Beef Association Addresses Packing Plant Fire, Details Recovery Efforts UnderwayFri, 23 Aug 2019 12:54:12 CDT
The National Cattlemenís Beef Association's Beltway Beef podcast focused its latest episode on the efforts that are underway currently to help the beef industry recover from the recent fire that has resulted in the temporary closure of the Holcomb, Kansas beef packing facility owned by Tyson Foods. This episode features commentary from NCBA leaders and staff including NCBA President Jennifer Houston, CattleFax Senior Analyst Kevin Good and NCBA Lead Lobbyist Colin Woodall - each offering an update on what NCBA and its associates are doing in order to assist cattle industry stakeholders affected by this event.
CattleFax Analyst Kevin Good began the conversation with a review of the beef market situation prior to fire. According to him, the beef market was already dealing with a larger supply of cattle due in part to continued expansion in the US cattle herd. Good says these numbers were expected to continue into the fall. With that situation as a backdrop, Good explains that once the fire occurred, end-user retailers scrambled to fill orders already in place for the upcoming Labor Day holiday assuming there would be limited supplies. This caused an already up-trending market to explode up $25. That has since declined by roughly $2 as initial worries subsided. Good believes this down trend will continue as the bulk of Labor Day preparation is over and the market begins to settle into its typical seasonal lows for the fall.
Good says the industry is collaborating to make sure it can band together to offset the loss of slaughter capacity having this plant offline causes. The Holcomb plant killed approximately 6,000 head per day. Good reports that livestock marked for slaughter are being relocated to other plants and adds that the market is offering packers an incentive for additional processing. Saturdays offer the greatest opportunity to make up time and slaughter capacity. However, it is possible the industry may decide to add Sunday slaughters to the mix as well. Good indicates that the current thought is that this solution will be able to support a certain level of normalcy but warns that any backup in slaughter could add additional risks to the market. He says it should be assumed that until the Holcomb plant is back online, the market will retain potential volatility. In summary, Good explains that the market had an initial overreaction and has since gained some stability.
In the meantime, NCBA Lead Lobbyist Colin Woodall is working to ensure the cooperation of policy and commerce leaders. Woodall says his team took immediate action after the fire to reach out to the National Economic Council, the US Department of Agriculture and other agencies, as well as the Commodity Futures Trading Commission and the members of both the House and Senate Agriculture Committees to brief them on the situation and to facilitate any recovery assistance they could provide and their help in minimizing the overall impact to the cattle business.
Woodall says the USDA has been immensely cooperative in ensuring that food safety inspectors can be moved around to other plants and have allowed them to work more and longer shifts. In addition, the Agricultural Marketing Service is also being compliant in supplying the needed meat graders. The Department is also working with packers and stockyards to ensure their best efforts in ensuring stability in the marketplace.
Woodall adds that NCBA is working to help mitigate the stress of this situation by appealing to the Department of Transportation to waive the current Hours of Service Rule for livestock haulers and has also requested weight limits for highways be waived as well. The DOT has not granted these waivers as of yet, however, Woodall says NCBA is engaged with influential policy leaders to help facilitate these requirements.
Click on the LISTEN BAR below to listen to this week's audio of the Beltway Beef Podcast for more information.
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