THEE Hot Barn Report!!
Heard ONLY on American radio stations across the nation and online at hotbarnreport.com!
Welcome to America’s Hot Barn Report now heard coast to coast and border to border
It is official, we have just confirmed our 12th reporting barn for the big fall run. We now blanket the great Northern beef belt from Motely, Minnesota to Torrington, Wyoming.
The problem is STILL the problem, concentration not capacity! Thanks for joining me today for this special Friday edition of the Hot Barn Report.
Three years ago, was a turning point in the entire food supply chain! Never before had this American consumer generation faced empty grocery store shelves. Never before had this generation had to come terms with how incredibly consolidated our food supply chain is which had led to a complete lack of resiliency amid the market chaos.
It has always interested me to watch where the blame was placed amongst the different food supply sectors. When baby formula was scarce it became terrifying for young families to realize that there were so few companies that held all of the power of making that formula. When baking yeast was non-existent for months at the store it became clear that basically only one company was making it. I could go on and on with more examples, but I saw the conversation around all of those food segments swirling around the problems that consolidation and concentrated power had brought to our consumers.
Then there was the beef supply chain. Interestingly enough there was only a small, but loud voice saying that we had a concentration problem in our supply chain, where 85% of the beef in our country pass through a narrow bottle neck of 4 global conglomerates that have made cattle producers price takers and consumers equally hostage to a broke food supply chain.
But still, some shouted that we just needed more capacity. Que the government! Rather that enforcing anti-trust laws on the books they do what government loves to do best, rush in under the guise of saving the day and throw millions of millions of dollars at the problem.
But now it is 2023, our cattle inventory is at a 60-year low! According to Sterling Profit Tracker our fed cattle packing capacity is only running at 85% and on the cow side we are down to running at 81% plant utilization. So, there are hooks open. The week ending March 25, we had a total cattle slaughter of 30,000 head less than that week a year ago.
Millions of dollars have been thrown around to try and bring new plants online with packer margins are thinning and competition for cattle is firing up. Putting these new plants in danger of running in the red from the get go and we know how that story will end.
So, once again the problem is still the problem, concentration of market power not capacity. This problem can’t be solved with more money, it will have to be solved with a bigger stick.
Let’s give a shout out to these Diamond Dozen Hot Barns that power this program: Stockmens Livestock, Lemmon Livestock, North Platte Stockyards, St. Onge/Newell, Platte Livestock Market, Tri County Stockyards, Torrington Livestock, Creighton Livestock Market, Bassett Livestock Auction, Mobridge Livestock, Ogallala Livestock Auction Market, and Presho Livestock. Catch them all on CattleUSA.com.
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