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The beef cattle market over the next 10 years
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<blockquote data-quote="greybeard" data-source="post: 983281" data-attributes="member: 18945"><p>(this could get long)</p><p>You said 10 years, so that's where I went, but I was speaking more of IN ten years, not the interim time period. I tend to look at global markets in all things, since that has affected all the US sectors so adversely.</p><p>But you may well be right regarding quantity versus quality. The general US consumer doesn't recognize the difference between prime and choice--they just look at the price/lb on the package in the meat case. But, the underlying cause of the long term switch to increased production of beef is foreign demand of both beef and grain exports. It will happen just like we saw with soybeans. The big soybean demand took off due to China's demand for it and we now have (globally) more acreage in beans than corn--and in many producing nations, more in beans than all feed grains combined. Combine that lost grain acreage with the ethanol production requirement, and we get the increase in cost/lb to raise an animal to slaughter weight.</p><p></p><p>China, since Tianemen Sq, has embarked on a steadfast policy of becoming a or THE global leader in every economic sector, including long range plans to be self sufficient in meat production, but they lack the grain production to pull it off. They will buy more and more US, Brazilian and EU grain to be able to feed their increased pork, poultry, and beef production. As the Chinese population becomes more prosperous, there is an ever increasing appetite for quality beef instead of the more traditional pork or poultry--just as they have become enamored with quality US automobiles and everything else. They are the world's largest user of energy products and have the ability to set the benchmark prices based on their needs and will be doing the same with cereal grains both for human consumption and livestock feeds.</p><p></p><p>China does not presently buy US beef because of the BSE thing, but that hasn't stopped them from buying up embryos and semen from top breeders and buying live breedstock from Australia and New Zealand. There is even speculation that a lot of the US stock going to those 2 nations is just being 3rd partied right into China under the radar of Chinese officials. Backtrack nation of origin is often difficult to verify on an international scale. </p><p></p><p>China wags the dog on everything bought or sold on a global market. They have the $$$ and we WILL sell them the grain they demand, if for no other reason than they have so much US long term debt bought up, and we have no choice but to provide them with what they bid on in order to keep them happy and keep them buying Treasuries. </p><p>All this results in higher costs to raise livestock here, higher prices in the grocery store and eventually (when China gets their livestock production up and running) another competitor on the international beef and dairy market.</p></blockquote><p></p>
[QUOTE="greybeard, post: 983281, member: 18945"] (this could get long) You said 10 years, so that's where I went, but I was speaking more of IN ten years, not the interim time period. I tend to look at global markets in all things, since that has affected all the US sectors so adversely. But you may well be right regarding quantity versus quality. The general US consumer doesn't recognize the difference between prime and choice--they just look at the price/lb on the package in the meat case. But, the underlying cause of the long term switch to increased production of beef is foreign demand of both beef and grain exports. It will happen just like we saw with soybeans. The big soybean demand took off due to China's demand for it and we now have (globally) more acreage in beans than corn--and in many producing nations, more in beans than all feed grains combined. Combine that lost grain acreage with the ethanol production requirement, and we get the increase in cost/lb to raise an animal to slaughter weight. China, since Tianemen Sq, has embarked on a steadfast policy of becoming a or THE global leader in every economic sector, including long range plans to be self sufficient in meat production, but they lack the grain production to pull it off. They will buy more and more US, Brazilian and EU grain to be able to feed their increased pork, poultry, and beef production. As the Chinese population becomes more prosperous, there is an ever increasing appetite for quality beef instead of the more traditional pork or poultry--just as they have become enamored with quality US automobiles and everything else. They are the world's largest user of energy products and have the ability to set the benchmark prices based on their needs and will be doing the same with cereal grains both for human consumption and livestock feeds. China does not presently buy US beef because of the BSE thing, but that hasn't stopped them from buying up embryos and semen from top breeders and buying live breedstock from Australia and New Zealand. There is even speculation that a lot of the US stock going to those 2 nations is just being 3rd partied right into China under the radar of Chinese officials. Backtrack nation of origin is often difficult to verify on an international scale. China wags the dog on everything bought or sold on a global market. They have the $$$ and we WILL sell them the grain they demand, if for no other reason than they have so much US long term debt bought up, and we have no choice but to provide them with what they bid on in order to keep them happy and keep them buying Treasuries. All this results in higher costs to raise livestock here, higher prices in the grocery store and eventually (when China gets their livestock production up and running) another competitor on the international beef and dairy market. [/QUOTE]
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