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Loveland, Colo. – International markets play more than just a peripheral role in the cattle industry, according to Duane Lenz, an analyst with CattleFax.

“Everyone wants to talk about world markets and exports. Why do we care? It means a lot of money on the export side,” he said during Range Beef Cow Symposium XXIV on Nov. 19. “Last year, exports added about $352 per head on a fed cattle basis. That is about $70 per hundredweight.”

Lenz further noted that projections estimate exports will contribute $500 per head by 2020.

“As we go through herd expansion, there is more beef, and if we can retain $500 per head, that will make a huge difference,” he added.

Trade agreements

Of particular note, currently, the Trans-Pacific Partnership (TPP) is an important agreement for the beef industry.

“It is important that we get TPP through,” Lenz said. “It levels the playing field for beef and lowers quotas to levels that are more in kind with other countries. We are pushing hard to get TPP.”

“It will give us a boost to the next level,” he added.

Though the agreement opens trade both ways, also allowing more imports into the U.S., Lenz explained that there is a need to bring in trim and allow the U.S. to sell muscle cuts to consumers around the world. The majority of the product imported to the U.S, he said, is lower quality cuts that go into hamburger and the fast-food industry.

Population impacts

The global market also continues to be of high priority in light of population growth predictions.

“In 1800, we had 1.6 billion people, and there were 2.4 billion by 1950,” Lenz said. “By the year 2050, 9.1 billion people are expected. That is a big deal. Who is going to feed them all?”

He continued, “Right now we are struggling to feed 6.8 billion. Who is going to feed them? Hopefully it will be beef producers.”

Lenz further noted that the middle class will grow exponentially, from 2 billion in 2012 to nearly 5 billion in 2030.

“By 2030, the middle class will have 4.8 billion people, and they will spend $32.6 billion on food,” he noted. “We need to get a piece. That will keep prices firm, and, in our belief, it will help everyone bring home more money.”

This year

At the same time, Lenz commented that gross domestic product (GDP) is also increasing.

“When we look at GDP and per capita annual growth, we can see cumulative growth in China,” he said, noting that incomes increased 250 percent from the year 2000. “Next is India, and it has doubled.”

The third highest growth since 2000 is seen in emerging markets.

“Those are the smaller countries that have never had much money,” he explained. “They are starting to grow, and there are a lot of people who will have money they have to spend someplace.”

Further data shows that, as per capita income rises, meat consumption increases.

“When people get more money, what is the first meat protein they go to first? Probably fish because it is readily accessible,” Lenz explained. “Then they go to poultry, then pork, and then they move into the top tier – they go to beef.”

China

In particular, Lenz noted that China’s consumption will continue to increase rapidly.

“China is so important,” he said. “They eat so much meat, and there are so many people. Their production has been fairly flat, and their consumption continues to rise. They have to fill that void.”

Those in the cattle industry get excited about the potential in China because, of the 1.3 billion people in the country, 600 million are peasant farmers.

“Per capita income in China in 2000 was $1,000,” Lenz explained. “In 2012, it was $3,350, and it is predicted to double by 2020 to $6,050.”

At the same time, the top 15 percent of their population makes $5,000 or more annually.

“That is 150 million people, which is the equivalent of the U.S. doubling their income in the next five years,” he said. “That would be pretty exciting, wouldn’t it?”

The increase in the middle class adds excitement for the industry. 

“The middle class in 2012 was 300 million, but that is projected to be 640 million by 2022,” Lenz added. “A big increase is coming up.”

Exporters

On a global scale, the U.S. and Brazil account for 51 percent of beef exports.

“The European Union, India, Canada, Australia and others are next,” Lenz said. “The top importer of meat is Greater China, which isn’t a lot of beef, but it is a heck of a lot of pork and poultry.”

Of the beef that is imported around the world, only 15 percent is grain-fed.

“That is our market,” Lenz commented. “Grassfed beef is about 71 percent, and that is what the world produces.”

He continued that growth has been seen recently in buffalo from India, which are considered bovine.

Australia, which has been in devastating drought over the past several years, has provided a large source of beef for the U.S.

“They have gone through drought and they liquidated their herd,” he said. “They will rebuild the herd, to drop imports to the U.S. and support beef prices around the world.”

Summary

With a growing world economy and tightening global beef supplies, Lenz said, “Prices have gone up sharply as the world has cried out for more beef.”

“We have tightening global supplies, increases in global demand and price inflation. We are very bullish,” he continued.

The global beef market holds strong potential for the U.S. cattle industry, and Lenz commented, “The global opportunities are great. We’re talking billions of dollars, not millions. The global potential for U.S. beef is very good.”

Meat Production

Looking at global meat production, CattleFax Analyst Duane Lenz noted that China is the top meat producer in the world.

“China doesn’t produce a lot of beef, but they have an awful lot of pork and broilers,” he explained. "In the U.S. and Brazil, we see more beef.”

Looking around the world, India has seen growth in their production of buffalo, which is sold as beef despite religious challenges. Brazil has also grown, and China has seen minor increases.

“Other major countries have been flat,” Lenz said. “We see drops in Canada, the European Union and the U.S. Many countries are flat or a little smaller."

Saige Albert is managing editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..

February is Lamb Lover’s Month, according to the American Lamb Board (ALB), who is sponsoring the “What’s Your Lamb Language of Love” contest on Facebook.

“Take our quiz and win a romantic weekend getaway for two in New York City,” says ALB.

By taking the short quiz, contestants are entered for the drawing and directed to a page of recipes.

Buying lamb

“Buying and preparing lamb is really easy. It’s in one of the top 10 foods that people think is hard to cook, but it isn’t any more difficult than beef,” comments Becky Gitthens of the Mountain States Lamb Cooperative (MSLC) in Douglas.

“When buying lamb, look for a soft pink to red coloring with a little bit of white marbling, which will give the lamb flavor,” Gitthens says.

Although it is sometimes difficult to find in Wyoming, consumers can ask for lamb in the store.

“Safeway carries Cedar Springs, which is a Mountain States brand,” she adds.

Lamb can also be purchased from the MSLC office in Douglas and can be shipped throughout the U.S.

Cooking and seasoning

“We also offer pre-seasoned cuts,” Gitthens notes. “Lamb picks up seasoning better than other proteins so we can do a lot with it.”

She adds that it marinates easily and does well with spice rubs.

“Grilling is one of my favorite ways to cook lamb,” she states, suggesting chops or burgers.

This time of year, slow roasting is another good option.

“There is nothing better for Valentine’s Day than a rack of lamb. It is really good on the grill, but it can also be done in the oven,” suggests Gitthens.

In a 325-degree oven, it takes about 15 to 20 minutes per pound to get medium-rare lamb.

“The key is not to overcook it,” she says.

Recipes

There are also new cuts  of lamb and recipes that many consumers are unaware of. The ALB website features examples such as Greek nachos, tandoori lamb steaks and barbecued lamb shoulder.

For grilling, roasting or braising, “We’ve got hundreds of delicious lamb recipes to tempt your taste buds,” says ALB.

Lamb comes from animals that are one year old or younger, which means that the meat is tender.

“We don’t have tenderness problems like other proteins,” explains Gitthens.

Health

There are also many health benefits to eating lamb.

“Lamb really fits the health-conscious consumer,” Gitthens says.

A three-ounce serving is only 175 calories and contains nearly half of the daily recommended requirement for protein.

“There are no synthetic growth hormones in American lamb,” she adds.

Lamb also contains vitamin B12, niacin, zinc and selenium, with nearly five times the omega-3 fatty acids and alpha linoleic acid of an equivalent serving of beef.

“Forty percent of the fat in a lean cut of lamb is mono-unsaturated, which is the kind of fat that is in olive oil,” she adds.

On average, a three-ounce serving of lamb contains fewer than 10 grams of fat and meets the Food and Drug Administration definition of lean meat.

Environment

Raising lamb is also beneficial for the environment.

“They clear forage that can be a fire hazard,” notes Gitthens.

Sheep grazing improves pasture and rangeland by recycling nutrients back into the soil, minimizing erosion and encouraging native plant growth, according to ALB’s website.

“Sheep keep moving, and people can hardly tell they’ve been there,” comments Gitthens.

Grasses tend to be the last thing that grazing sheep look for, meaning they would rather eat weeds and forbs.

“They go after the stuff with oils in it first,” she says.

The ALB website mentions that wineries often use sheep to graze the weeds in the vineyards.

“Sheep are easy on the land, and grazing is sustainable,” states Gitthens.

Economic value

Lamb and sheep are also historically significant in U.S. Gitthens recently visited a conference with the American Sheep Industry Association (ASI), which is celebrating its 150th anniversary.

“ASI is the oldest livestock organization in the U.S.,” she explains.

The first group of sheep producers was organized in 1865, right after the Civil War and after Lincoln was assassinated.

“The sheep industry is really important to our Wyoming economy and to our national history,” she states.

Although it is not always easy to find in stores and restaurants, Wyoming is one of the top five lamb-producing states.

“The highest per capita consumption is in the northeast, but we see the demand for lamb growing across the U.S.,” she comments.

There is also a growing market for lamb among younger consumers who want to try different foods and are looking for a quality eating experience.

“In New York City, I can hardly pick up a menu that doesn’t have at least two or three lamb selections,” she explains.

It disappoints her that there isn’t more lamb on local menus, where the protein is part of the economy and landscape.

“Any restaurant in Wyoming that is interested in lamb should give a call to my office,” she states.

Promotion

Gitthens is hopeful that the market will grow in the state. MSLC visited a recent fall festival in Jackson and served samples of lamb to over 700 people.

“Many of them said they didn’t eat lamb, but when we got them to try it, almost 100 percent were amazed at how good it was,” she says.

People tend to remember one bad experience with lamb and never try it again, maybe because it was too fatty or they remember mutton.

“A poor hamburger doesn’t keep people from eating another hamburger,” she explains.

One bad experience shouldn’t prevent people from trying more lamb, or from looking into all of the versatile ways in which lamb can be prepared.

“As a co-op, we are constantly marketing lamb and promoting it,” she comments.

MSLC’s meat company, Mountain States Rosen has been working with food bloggers and social media to raise awareness for their product.

“Back in November, we topped 9,000 fans on Facebook,” she notes.

Mountain States also has a presence on Pinterest, Twitter and BuzzFeed.

“We want people to try lamb for the first time, again,” Gitthens says.

Natasha Wheeler is editor of the Wyoming Livestock Roundup and can be contacted at natasha@wylr.net

In estimates anticipating the Dec. 21 Cattle on Feed report, CME Group predicts that trends will continue, with lower cattle numbers in surveyed feedlots. The group also notes that analysts expect the report to be closer to 2012 levels. 

 

It took a few months this winter and into the early spring for calf prices to climb up to 2016 levels, but since May, prices for 2017 have been very consistent with prices in 2016. For reference, I have included a chart for 500- to 600-pound steer calf prices on a weekly basis from the Southern Plains to the right. Other regions all show very similar patterns.

As you can see from the chart, prices in 2016 saw sharp declines from mid-August through the end of October. The question is, will we see a similar pattern in 2017? I don’t think that we will see as sharp of decline, and I think average prices for the third and fourth quarters of 2017 will be higher than 2016. Average prices for 500- to 600-pound steers in the Southern Plains region in the third quarter of 2016 were $157.12 per hundredweight and $138.44 for the fourth quarter of 2016.

As of Aug. 28 of this year, the Livestock Marketing Information Center is projecting that 500- to 600-pound steers in the Southern Plains will average between $161 to $163 in the third quarter and $148 to $153 in quarter four.

According to the latest Cattle on Feed report by USDA’s National Agricultural Statistics Service (NASS), the number of animals on feed in lots with 1,000 or more head capacity remained above a year ago. That would be expected, given the increasing size of U.S. calf crops in recent years.

The on-feed count as of Aug. 1, at 10.6 million head, was 4.3 percent above a year ago, slightly below the year-over-year rise posted as of July 1, which showed an increase of 4.5 percent.

In terms of head, the latest count was 439,000 head above 2016’s and the largest as of Aug. 1 since 2012. However, July placements only increased 2.7 percent compared to a year ago, which was a smaller increase than many analysis expected.

Drought conditions in the northern plains may have led to some early placements into feedlots from Nebraska and South Dakota. Their placements were up 35,000 head and 8,000 head in July over the previous year.

Hurricane Harvey could also have a short-term impact on the market, depending on the number of losses, after it is all said and done. There are 1.2 million beef cows in the 54 counties that were declared a disaster area in Texas. I think I can safely say that almost all of us hope we will not see a significant market impact and that the producers in Texas will come out of this with as few losses as possible.

As a final point in looking over the last two years and thinking about the next few years, it is important for producers to develop some flexibility in their marketing plan. Producers should analyze those value-based marketing windows and determine if they have the resources and cost structure in place to target those marketing windows.

If you have read any of my articles over the last few years, you will know what is coming next. The Wyoming Ranch Tools website at uwyo.edu/ranchtools has a break-even budget calculator designed to help producers make these market timing decisions. It can also help in deciding if investing in a value-added program can make sense on an operation.

Washington, D.C. – Beginning on June 27, the Trump administration opened a three-day hearing process to discuss the renegotiation of the North American Free Trade Agreement (NAFTA).

National Cattlemen’s Beef Association (NCBA) President-elect Kevin Kester shared his speaking experience on the “Beltway Beef”podcast.

According to Kester, the U.S. Trade Representatives Office’s NAFTA renegotiation process hearings have attracted a large number of stakeholder.

“There are sectors from all across industry and business to other interested stakeholders regarding NAFTA that are testifying before the U.S. Trade Representatives staff at their offices here in Washington, D.C.,” said Kester.

Standpoint

“On behalf of NCBA, I was delivering a message that we strongly support NAFTA because of the great and huge markets it has created over the last 23 years with Canada, Mexico and the United States cattle and beef industries,” commented Kester.

He noted the association was particularly concerned with emphasizing the successes of the current NAFTA agreement.

“I gave information on the successes of NAFTA today and how we don’t want unintended collateral damage, so to speak, during renegotiations and the modernization process of NAFTA,” Kester stated.

He continued, “We want to ensure that agriculture, and specifically beef and cattle, are included in some parameters because, right now, we have zero tariffs and unfettered access for our products into Canada and Mexico, which are each more than $1 billion markets for us.”

Labeling

Country of origin labeling (COOL) was another topic debated during the hearings by agricultural organizations, with Kester sharing the stance of NCBA against reinstating the law.

“There were two other organizations that brought up country of origin labeling, and I was happy to explain that COOL was the U.S. law for over six years, and it did fail to deliver on its promises to build consumer confidence and add value to our producers,” said Kester.

According to Kester, the end result of COOL was a long battle with the World Trade Organization and the U.S. faced the promise of more than $1 billion in retaliatory tariffs from Mexico and Canada if COOL was not repealed.

“We want to make sure that COOL doesn’t raise its ugly head back up again on a failed government mandated program and we get in a trade war with two of our biggest trading partners,” Kester concluded.

Emilee Gibb is editor of Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..