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Kentucky’s beef industry shows continued strength
By
Laura Skillman
LOUISVILLE. Ky., (Dec. 12, 2007) – While 2007 was a struggle
because of low feed supplies, Kentucky beef cattle producers
continue to enjoy strong demand for their products and strong
prices. Feed costs will continue to be an ongoing challenge.
While high prices often result in an expansion in the cattle
herds, little change in the overall herd size is expected in the
coming year, said Lee Meyer, agricultural economist with the
University of Kentucky College of Agriculture.
Meyer said while many economists are predicting an increase in
production next year, he is not. Because of drought conditions
in the west in 2006 and in this area in 2007, there have been
some reductions in herds. Kentucky is the largest cow-calf state
east of the Mississippi River.
“I think what we are looking at is some rebuilding of herds,” he
said. “This will take some of the heifers out of the meat chain
and put them into the cow chain. That’s going to pull production
back a little bit and give us a pretty good upcoming year.”
Nationally, prices for feeder calves moderated somewhat because
feedlots were dealing with high feed costs. But as corn prices
leveled, the price of slaughter cattle increased along with the
price for feeder cattle. Feedlots are Kentucky’s primary market.
Prices have also fluctuated in Kentucky in the past year,
because farmers sold calves earlier and at lighter weights as
pastures dried up. From June through October, sales were up
between 45 and 50 percent. This hurt midsummer prices in the
state, but those prices have rebounded as the year ends and are
actually higher than a year ago, he said.
Those early sales will mean 2007 cattle revenue for Kentucky
will likely be up substantially, Meyer said.
“We pushed a bunch of cattle to market that would have gone to
market next year and we’ll probably have higher revenues this
year with the pretty good prices we had,” he said. “But we are
going to pay the penalty for that next year in terms of a drop
in cattle revenues.”
Next year, demand for feeder calves and slaughter cattle will be
strong, he said. Feed costs, although they are high, look to be
relatively steady and that should help maintain strong prices.
He expects prices to be similar to this year.
Meyer said it will take a couple of years for cattle numbers to
build up enough to push prices down.
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Contact: Lee Meyer, 859-257-7272, ext. 228
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