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> you can't get around that there is just a lot of extra money in the economy right now If this were explained by across-the-board inflation, we would not have

> you can't get around that there is just a lot of extra money in the economy right now If this were explained by across-the-board inflation, we would not have seen the decades long shift of the profits from those raising animals to the meat packers as the market consolidated. Agriculture Secretary Tom Vilsack: Farmers are losing money on cattle, on hogs and poultry that they're selling at a time when consumers are seeing higher prices at the grocery store. And there are now record profits or near-record profits for those in the middle. And I remember talking to a producer the other day at Council Bluffs, and he said, I don't get this. I just sold my cattle, and I lost $150 a head. But the processor made $1,800 a head. How can that be? https://www.npr.org/2021/09/13/1036769709/a-handful-of-big-meat-packing-companies-may-be-pushing-up-the-price-of-groceries https://www.npr.org/2021/09/13/1036769709/a-handful-of-big-m...

ksec 5y ago
> and I lost $150 a head. But the processor made $1,800 a head. I am pretty sure $150 is "Net", while $1800 is "Gross". Not to mention Meatpacker gets all the benefits of current market because of how and when the deal and distribution are structured. As is the case in every industry, I have no idea how to fix this. Another point worth mentioning, US Beef pricing are much more susceptible to export market demand than pork or poultry.
legitster 5y ago
I would take the rancher anecdata lightly, cattle prices have increased hugely over 2021. There were a couple of big dips (where meatpackers probably shut down or had worker problems), but it doesn't look like raising cattle was worse in 2021 than 2020 or 2019. https://futures.tradingcharts.com/historical/GF/2021/0/continuous.html https://futures.tradingcharts.com/historical/GF/2021/0/conti... (Unless of course, they sell at contracted prices that didn't account for... across the board inflation) And again, none of this explains why my local butcher who doesn't buy from midwest feed lots raised their prices.

ksec 5y ago

> and I lost $150 a head. But the processor made $1,800 a head. I am pretty sure $150 is "Net", while $1800 is "Gross". Not to mention Meatpacker gets all the benefits of current market because of how and when the deal and distribution are structured. As is the case in every industry, I have no idea how to fix this. Another point worth mentioning, US Beef pricing are much more susceptible to export market demand than pork or poultry.

legitster 5y ago

I would take the rancher anecdata lightly, cattle prices have increased hugely over 2021. There were a couple of big dips (where meatpackers probably shut down or had worker problems), but it doesn't look like raising cattle was worse in 2021 than 2020 or 2019. https://futures.tradingcharts.com/historical/GF/2021/0/continuous.html https://futures.tradingcharts.com/historical/GF/2021/0/conti... (Unless of course, they sell at contracted prices that didn't account for... across the board inflation) And again, none of this explains why my local butcher who doesn't buy from midwest feed lots raised their prices.