Beef business problems: cattle population at 63-year low

By: Max Hess - Email
By: Max Hess - Email

Posted Wednesday, July 30, 2014 -- 10:00 p.m.

Cargill, a Minneapolis based meat producer, says it is planning on closing a processing plant in Milwaukee on Friday.

It will result in 600 people losing their jobs.

Another plant at the same site, that employs about 200 people, will stay open.

Much of it is a result of droughts in 2011 and 2012 that hurt cattle numbers because grain prices (and therefor cattle feed) skyrocketed-- now resulting in the lowest cattle population since 1951.

It's a trend that has hurt local cattle business as well.

Scott Trautman with Trautman Farms in Stoughton says his business has remained relatively stable because of his select customer base and unique way of organic farming, but he is well aware of what is going on across the country.

"The overall number of animals available is down, the number of slaughter houses available are also down, meat prices are headed up," he explained.

Trautman did say that he believes the trend is somewhat cyclical.

He said that grain prices right now, for example, are really cheap -- which could very likely result in the cattle businesses recovering.

"High cattle prices, low grain prices is going to encourage people to get in the cattle business one way or another," he said, adding that there is one more problem to consider.

"The animals are so expensive right now that I don't know how you can be profitable with it."

There are a lot of factors to consider, but generally speaking: high grain prices, less cattle; less cattle, more expensive beef in the grocery store shelves.

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