Many in the Ag sector will be happy to say goodbye to 2019. And at the top of the list is the livestock industry. Mike Zuzolo, President of Global Commodity Analytics, said this year was not a good year for those with livestock.
“No it wasn’t, I mean, given the packer break-evens being in the hundreds of dollars for a lot of the time for cattle, and given the cash prices of hogs struggling to get above the $50 live prices and seeing that African Swine Fever was decimating half of the world’s hog production and hog herd, I would say that 2019 was a big disappointment to the cattle and hog industry.”
Things were especially challenging in the second half of 2019, between trade uncertainties, the major fire at the Cargill plant in Holcomb, KS, and challenging weather for many stretches of the country. At the same time, retail prices in the grocery store and at the wholesale level were sharply higher, which he says, “made matters worse.”
There are a lot of cattle placed out there and more cattle on feed that aren’t getting into the marketing channel as rapidly. Zuzolo said cattle producers have been waiting for low prices to turn around.
“This goes back to the cheaper prices and the low prices. The only thing the rancher can do, the cattle guy/producer can do, is hold back his cattle, feed them out, heavier weights, waiting for better prices, and that’s what he’s done, and he’s done a good job because we’ve gone from $95 to $122 at this point.” Zuzolo pointed out.
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