Beef prices- where is the money going?

I was wandering with the prices at the supermarket so high how the farmers were making out. The local auction results showed cows and bulls were bringing between $ .40 and $ .85 a pound live. Beef averaging about 20 cents higher. If you get about 40% meat out of your animal then your talking a cost of about $1- $2.50 a pound for finished meat.
Seems like an awful lot going to the middle man- time to go back to the days of growing and butchering your own I guess. Maybe some farmers can chime in here- not sure if my math is correct but it seems $4- $10 a pound is going to the middle man.

There are 4 large packers in the country with a monopoly on the market. They are profiting over 1000.00 per head.

Carcass weight should be about 62.5 percent of live weight.

You're not wrong. Packers and grocers have been sticking it to the producers for quite some time. I have family in the beef feeding business and do not buy from the store. They do better and I get better beef!

I just sold a couple primes. 2.50 lb hanging, comes to about 1.50 on the hoof. locker plant will charge about .70 processing. These steers weighed 1300- 1350 and hung 800-850 lb.

Packers have been making $700 to a $1000 a head PROFIT for quite some time

We just bought a 1/2 a beef.
The farmer got $900. The processor got $385.
Don't know what the start weight was. But it was from my wifes cousin.


Cost $271 a pound.
No middleman.
just

100% right monopoly by the packing industry, and 2 of them are foreign owned.

Nobody thinks wages might have an effect on prices?

What’s a reasonable wage and how many man hours to butcher one animal? We are talking $1000 per head- it doesn’t take 40 hours to process one animal.

Doesnt seem to affect pork as much though

Maybe because hogs don’t fart and cause global warming!

Sounds like an opportunity for some of you to become meat packers, get out your checkbook and get going, lots of profit available.

Cargill, Tyson Foods , they’re making out like bandits.

I'm not defending the butchers, and I'm not arguing, I think they make more from my beef than they deserve. Now a few points, I can only speak for Indiana. They take in more than 1 animal a day, so you must have and maintain a place to keep them until there killed, then skin and gut them, this must also be stored and disposed of, then they hang for a week or two in a cold room, each day a qualified USDA inspector must be paid, all butcher equipment must be cleaned between each days use. Saws, grinders, knives, stainless tables, floors and walls must be sanitized each day. Then primal cuts are made, these are cut and wrapped to each customers specs. All of these things cost in time and skilled labor. All of these things must be maintained. Now you must pay everyone and the cost for the building and utilities. Local taxes. I'm missing a lot I know but it all (the money) doesn't go into the butchers pocket. That's why we have 3 out of business in my county now. The big packer here Indiana Packers is owned by a jap company and is one of the largest employers in this part of the state. And as a side note less than 2% of all beef produced in the US grades prime.
Case.

Beef is competitive. Nobody has a corner on the market. We still have a free market. Don’t we get some beef from South America.

Venison ain’t cheep at my house. Sure is good to have a full freezer though.

I worked for a butcher for awhile right out of high school. Two of us cutting one wrapping. We would do 2 1200 lb. Critters a day and be done by 2 o’clock. I’m sure packers are much faster with the machines they have nowadays

Those big beef processing plants in, Amarillo, Cactus TX, Hereford TX, Holcomb KS, Dodge KS, Liberal KS, Do multiple thousands of head a week, each.

Amarillo and Dodge both have multiple packers doing thousands of head a week each.

Indiana Packers 200 semi's per day. Another plant one county east. Nephew owns the company that sanitizes the trailers between trips.

Casexx isnt that pork processing?

No it doesn't -- but when you hire someone that it takes twice as long to get the job done and they only show up maybe 3 days a week. the cost goes up -- however if you pay illegals ( the only ones you can find that will actually show up and work a full day) your costs go down some -- so I think there is a little give and take there.

Yes, I.P. Is all pork, all from cfo's. But the ones I and others use for our farm folk customers are mom n pop butcher shops and the conditions I described above are about the m-n-p's shops. Those are the ones out of business due to the fact, they can't compete wages wise. The labor all goes to I.P. better pay and benefits. About 95% Mexican people. The two plants I described are in towns made up of second and third generation Mexican folk. These two towns are in the middle of tomatoe growing ground. The older ones came in the 70's to pick tomatoes and stayed. Now there youngsters make up a large part of the surrounding work force.

I'm not sure if other states have something similar, but here in Kansas there is a facebook page that was started a few years ago to put buyers in contact with sellers. It's called "Shop Kansas Farms". Farmers can list anything they have available and buyers can connect with them directly. It really took off and has turned out to be a great page. If you're in Kansas you should definitely check it out if you're in the market for beef or anything else. If you're in another state maybe they have something similar.

Feeding cattle now is tough. Feeder market has been slammed by high corn prices. Our current cost of gain is $1.35/pound which is very high. We will run out of “cheap” if to call $6 cheap at the end of the month then things will get crazy. We feed between 4,500 and 6,500 bushel a day of corn. The current level of inflated input cost hit you from all sides. Most guys feeding cattle have loans and those loans have caps. We have loans with caps too $4 fuel, $7-8 dollar corn, Interest creeping higher all hit hard. The 4 packing plants we have close to use kill thousands of head per day and as stated above they are making around $1000 per head. They will clear more on the hide then most producers will on the individual beef. This is nothing new and there isn’t a answer. Captive supply is and has been our enemy in the beef industry.

JBS is another South American organization along with Tyson, etc that control the beef market.

I asked my cattle raising friend why stores don't by more from local processors. He said if the big companies like JBS find out the store is buying from someone else they will make them an "offer" that they probably won't refuse.

The words cartel or mafia could be interchangeable here. He commented that it has been going on for a long time.

Yep had family friends that tried there had at meat packing. When the product hit Chicago and NY city the dock workers wouldn’t unload it

Last I heard a figure the packers were averaging $139 on the waste . Hide , feet , head , guts , fat , bones
Small processors have to pay to haul it away . The packer lobby is so strong they don't eaven have to label what country it comes from . They can import containers of frozen beef from Namibia grind it into burger and sell it as product of USA. A few states fave finally started to get truth in labeling but not many .

The vast majority of steaks we buy at the grocery store is CHOICE not LRIME many store don't eaven stock any prime . Over 80% of fed cattle will grade choice or better .
THE FAT COW AND BULL slaughter is not controlled by 4 packers it is made up of lots of bologna , sausage and burger products high dressing cows and bulls are bringing 90 cents to $1.30 . fat fed stiers and heifers that grade 80% choice or higher are only bringing $1.30 to $1.40 . When there is so much collusion on price going on that bologna bulls are bringing within 20 cents of cattle that we cut up in steaks something is wrong

Absolutely Something is Wrong

To much info, to little time for me to attempt to begin to explain. NCBA, feeders, stockers, cow-calf, finishers, recips., A.I. bulls, packing houses, just tried to hit the high points as it relates to the man on the street. The guys above have added lots of good info. Each with their own set of minutiae. Finish by saying if your not in bed with the NCBA your gonna be on the loosing end of the stick. Just asking folks to not put the blame for high beef cost on the small producers. Thanks all for added info.
Case

Post Script:
You guys getting your 50 page full color auction catalogues yet? got one last week. Must have cost a million or more to print and mail, and that's just one of many that will come this spring.

That was the point of my post- the small producer works the hardest and makes the least profit. Everything is run by big business many owned by foreign companies. The average consumer goes to their local market and thinks they are getting a local product or most don’t care where it comes from.

The USDA has changed inspection policies and some states have changed their laws and you can buy meat from local butcher shops in many places they did not change the laws they just changed policies so when the beef prices get high in the next couple years because of competition that is being developed now in the processing industries and the impending beef cow shortage that's coming . The feds will change policies again and put the little guys out of business again by exerting their power through regulation and unfair inspection policies

The middle man and end man are making bank. I’ve said all along the best thing that came out of covid was how many more people are going direct to the seller now instead of the store. Better for both the buyer and seller. Around here the cost is currently about $3.50 per hanging weight pound for a fully processed beef. Use to be cheaper until the price to get them to market weight went up.

https://www.wsj.com/amp/articles/cattle-ranchers-meatpackers-beef-price-inflation-11647874135

Funny- this just came out.

I saw beef bologna for $6/lb and you know that's not choice beef. Pork/chicken/turkey is 2.99. The country of origin label ban is criminal.

chinese owned????

Cargill-American
Tyson-American
JBS-Brazil
NBP-Brazil

China owns Smithfield Foods, the pork producer, very big company.

The packers are the ones making the money on beef right now

China is also working to gain more control of the poultry processing and production. The link below is off topic but discusses China's continuing efforts to buy farm land in the USA and many other nations. Their progress in the USA is slow but in other nations they have increased ownership 10 fold in a short time.

https://americanmilitarynews.com/20...kers-are-scrambling-to-try-to-stop-them/
We also need to recognize that the 4 major beef processors can control the market in many ways. If they indeed are making high profits on processing they can reduce profits for a time and pay way more for beef and thus keep a lot of beef away from the new start ups that we are working to fund. Not unlike Wal Mart or any big box that comes to town, they can just sell at a loss until the competition is gone. One of the things that free minded capitalism does allow is assets can be sold to anyone they choose even if it may not be in the best interest of a nation. Right now there is a lot of attention about food so not much will be sold or changed now. Land here is very high priced and thus limits sales to anyone somewhat. If there can be enough market pressure coming from other regions and they can control markets more then highly leverage land assets could be a big risk if prices fall below production costs for extended periods of time.
I watched some you tube stuff Sunday on companies that are collecting and storing pollen. Huge potential change in commodity production. Most pollen lives for hours not even days. If weather is bad, poor pollination and poor crop. They can harvest pollen and store maybe for months if not years if done correctly. Wow could yields skyrocket from this. Could also create the first hybrid wheat. Wheat does not allow hybrid production naturally and wow could that be a major game changer. It is being utilized today in major trials and yes unfortunately this will not be a technology that will be real usable or cost effective for smaller producers.

Bryce