Whats Happening to Cattle Prices?
Prices for beef cattle declined steadily between 1994 and 1996, after 7 years at or near record levels. The 45,000 U.S. feedlots (which finish cattle with grain and sell them to meat packing firms) paid an average of about $68 per cwt. (100 pounds) for the “feeder” steers they placed on feed during 1995, down 15% from the 1994 average of about $80, and down 24% from the 1993 average of about $89. U.S. Department of Agriculture (USDA) and other analysts reported that feeder cattle prices have averaged about $59 per cwt. so far in 1996, posting a low of about $53 in April but climbing back to about $63 by October. Most “feeder” steers come from cow-calf operators, who breed and then raise beef cattle on pasture and hay for up to one year or more before selling them to feedlots. There are between 600,000 and 900,000 cow-calf operations (many of them family-owned ranches), depending upon which data are used. Low prices could force many higher cost and highly leveraged operators out of busi
