Beef producers in California are struggling with precarious market conditions that have been exacerbated by COVID-19 issues. President of the California Cattlemen’s Association, Mark Lacey explained to AgNet West that while processors are working as quickly as safely possible there are still large cattle inventories in the state.
“We have a large supply of cattle and they’re only capable of processing so much but they’re doing their very best it sounds like,” Lacey noted. “This year we are working through large inventories and we were actually expecting to start seeing uptrends…up until and when the government mandated all the social distancing, quarantine, those type of things. It had a dramatically negative impact on prices of cattle.”
There have been several interruptions in national processing due to COVID-19, however California has been able to avoid any facility closures. The updated safety measures have slowed things down a bit at processing facilities, adding to concerns of an already large cattle inventory in the state. Lacey noted that nearly all segments of the beef supply chain leading up to processors are experiencing significant losses due to the backlog of cattle inventories.
“Most all of those segments are experiencing losses and maybe even record losses while we see wholesale and retail prices being fairly high; close to record-highs, not quite yet,” Lacey explained. “Those profits are only being experienced at the retail and processing level.”
Although California beef producers are facing some significant challenges, Lacey remains confident in the resiliency of the industry in working through adversity. “By and large we have some great people in the business here in California and like I said mostly we’ve learned to fight through tough weather and tough markets and this is a unique challenge we’ve got before us now but I have faith in our guys,” Lacey noted.