AgriTalk: Ranchers Sound Off on Pandemic Response
Katie James, Drovers
May 20, 2020
As the nation grapples with the COVID-19 pandemic, the cattle industry has faced huge disruption. There’s tension in every segment, between producers and packers, between producers and commodity groups, and even between producers and other producers, AgriTalk host Chip Flory says.
It also affects the relationship with consumers as higher prices hit, AgriTalk Farmer Forum guest, Casey Schuhmacher, a rancher from Nebraska, says.
“None of us have ever seen as much tension as we've got now, as you look across this. This is highlighted kind of where the choke points are in our industry. And I think as we've progressed, we've kind of forgotten some of the simple stuff of what we're doing,” he says.
“You notice we're not having these discussions about the sale barn down the road at a cash feeder cattle auction. I've sat at a feeder cattle auction, I've sat at numerous cow auctions, where there's only two buyers in the stands, maybe three. And those markets stay competitive and stay honest. So, we have to really kind of think about, ‘oh, why is that?’” he continues.
It’s affecting producers on every level from the feeders, and stockers to the cow-calf operators.
“If you look at the feeder side right now, guys that were supposed to be pushing cattle to the packing houses just watched a major bottleneck happen. I have friends out here in California, and guys I know throughout the Midwest are going, ‘Hey, what's with the volatility in the market right now? We can't do anything. We can't buy as many cattle as we'd like to buy,’” adds Farmer Forum guest Jack Lavers, a cow-calf operator in California.
“That hits the stockers, that hits the cow calf guys like myself. What are we going to do with our calves? I’m fortunate my biggest paycheck comes from my calf sales in the fall. So, I'm not there yet. But I have bred heifers to market right now, and it’s scary,” Lavers says.
Consumers see the bottleneck and start to worry about their food supply as well. Lavers says he’s been getting calls from his wife’s coworkers at Adventist Health, asking to buy a side of beef because they’re worried that they won’t know where their food is coming from.
“I try to tell everybody, ‘Hey, you just need to relax. There's not a beef shortage, we have a bottleneck. It's slow getting out. Everybody needs to take a deep breath. Take a step back and really look at what's going on,’ And I think ultimately, we see people on all sides going, this is how we fix it,” Lavers says. “And I want people to know there is no one thing that is a silver bullet, there's not a single thing that is going to fix the market today, tomorrow, or next week. It's going to take a lot of different things. And we really got to think this through because we can really screw up our markets even worse if we're not careful.”
There’s no one thing that will fix it, but even if all the suggested fixes out there now were implemented tomorrow, it still wouldn’t be an immediate fix, Schuhmacher agrees.
Both producers have been approached by neighbors in their community, wanting to buy meat directly, but the wait at meat lockers is so long that many can’t get an appointment to have it processed locally until next year.
In terms of the proposed Fed Cattle Set Aside Program, Lavers disagrees with its implementation.
“I don't like any of these programs that are coming out. And I'm not going to say that I'm not going to use them. And I'm not going to criticize anybody that's using any kind of Federal program right now,” he says. “We don't as individuals know exactly what's happening to those individuals. And so, if people need help, and they got to figure out what's best for them, go for it, but I really do not like just money running out there and blowing up our deficits and doing anything like that.
“What we really need to look at is why we have the issues at hand. And, you know, in my opinion, one of the major issues that we have, and I think most people would agree, is that we have an overconcentration of the size of the packers—the Big Four. And we saw it last fall with the Tyson fire at the packing plant. That hit me hard last year. So, I'm getting really a double whammy here again with the COVID-19. And we see these bottlenecks happening and what it really does to our industry. We need to look at that and address it, but we need to address why the packer concentration truly happened,” Lavers says.
Schuhmacher also doesn’t have optimism for the set aside program as a fix. He feels...
more, including links, audio [19:52 min.]