Cattle Industry Needs More Capacity to Meet Demand

AMARILLO, TX – The announced closure of one of Canada’s largest beef plants is highlighting a true North American processing challenge according to the Cattle Market, an online cattle website. The closure reduces Canada’s processing capacity by one third and the temporary closure is expected to last two weeks. Producers of fed cattle are anxious to see if last week’s 503,000 head of slaughter established the low baseline for rebuilding weekly kills to a 600-625,000 head level. Three weeks of diminished capacity are taking a toll, especially since concerned retailers pushed boxed beef prices $10 higher. Feedlots with finished cattle to sell were without a kill slot as formula and contractual obligations fill all the current capacity, leading to a disappearance of cash markets. News reports assure consumers the processing slowdowns across the entire range of ag food products will not result in shortages but it can not keep from doing so, the website suggests. Anything short of 600,000 head per week will not satisfy beef demand.