Rabo Analyst Don Close Predicts Grow Yard Concept Will Become Essential to the Beef Pipeline SystemWed, 25 Sep 2019 10:22:28 CDT
Don Close is vice president for food and agribusiness research with Rabo Agrifinance. Over the past year, he has been discussing with the beef industry a relatively new concept which he refers to as the “grow yard.” Close defines a grow yard as a niche segment in the beef pipeline situated between the stocker operator and the feedlot which provides residual housing for cattle that for one reason or another are delayed on their way to market. It is his belief that as this burgeoning segment continues to grow, it will eventually become essential to the industry. Economically speaking, he believes grow yards will have enough going for them in the future to remain sustainable.
“I think there are a host of reasons. I think one of the basic drivers behind this whole thing, the biggest one would be just the shortage of labor issue. That’s not going away anytime soon,” he said. “I think another big driver is the growth in beef demand we have seen in the last five to ten years both domestically and in export has been driven on beef quality. The pressure of that to continue to increase that quality is only going to increase.”
In addition, Close also cites the continued contraction of grass acres available to cattle producers. He explains that as the US herd continues to expand, there will be less and less grazing acres available. He believes grow yards will offer producers an alternative option that could help displace yearling crops and open up grazing space for cows.
“From the cow/calf producer’s perspective, I think it’s good news for him. Because it not only increases the number of potential buyers for his calves, but it broadens that sales window out instead of the classic deal of seeing vast numbers of calves coming to market from September to early November. It enables both the seller and the buyer to stretch out that sales window to create opportunity and not trying to sell your cattle at the same time all your neighbors are. I think it’s going to be a bigger component of the industry going forward.”
Listen to Close offer more insights into the grow yard concept and how its role is developing in today’s beef industry, on today’s Beef Buzz with Radio Oklahoma Ag Network Farm Director Ron Hays.
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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