Cattle Producers May Have to Live with Market Volatility for Several MonthsTue, 17 Mar 2020 16:04:21 CDT
On Today’s Beef Buzz, Producers May Receive Some Compensation For Depressed Market
On today’s Beef Buzz, Radio Oklahoma Ag Network Farm Director Ron Hays talks with Dr. Derrell Peel, OSU Extension livestock economist, about the COVID-19 impact on beef markets.
Cash cattle markets are under severe pressure, as are all commodity markets, resulting from the uncertainty caused by the COVID-19 outbreak. Dr. Peel said it has depressed the cash and futures markets.
Obviously, the markets are trying to figure out the worst-case scenario, which is what they are supposed to do, Peel said. We’re down about $25 per hundred weight on the feeder cattle and the same is true for the slaughter cattle, Peel said.
Peel said he is not sure there is much prospect of the market recovering for at least a month but there could be short run ups in the market.
That could seem like an eternity, especially for cattle producers with animals ready for market.
In the southern Plains states cattle are coming off wheat pasture now and many feedlots have cattle ready for slaughter.
When cattle are ready, they’re ready, Peel said, and there is not much we can do about it.
At the retail level, we’re seeing strong demand for beef as consumers are reacting to the uncertainty.
Peel said closing restaurants could hurt beef demand as more than 50 percent of total food expenditures come from eating out.
We’re shifting from food service industry to the grocery stores, Peel said.
The impact will be felt by all businesses, especially small business. Cattle producers are considered small businesses and we want to pass along information from the Oklahoma Cattlemen’s Association regarding compensation for the depressed markets. Here is what the OCA said:
It is OCA’s understanding that farms and ranches are considered small business. Therefore, if you sold cattle this week, compare that to what the same weight of cattle would have brought two to four weeks ago and report the difference.
Oklahoma has applied for the SBA disaster declaration, which is different from the state of emergency declaration. For Oklahoma to receive the declaration and be eligible for assistance, small businesses, including ag businesses, need to report their losses.
This can normally be done on SBA’s website, but their site is currently down. In the meantime, Oklahoma has its own site where businesses are highly encouraged to report financial losses from COVID-19--- www.damage.ok.gov. Oklahoma needs 5 businesses to declare loss in order to receive the disaster declaration. Then, we need one business per county to report in order for the county to be declared. Once a county is declared, the counties contiguous will also be declared.
Click on the LISTEN BAR below to hear the complete interview with Dr. Peel as he talks with 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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