“Meat, the redder, the better.” Words of wisdom from the grill master (me). However, those folks who raise that red meat (which includes all types of the protein products in the meat case at your local grocery store), for the most part, had a difficult year.
The U.S. ag sector has to be happy to see the end of the calendar year 2019. It was rough, which might be the understatement of the century so far. I’ve been doing a series of interviews for the National Association of Farm Broadcasting News Service (I’m the assistant editor/reporter) that looks back at 2019 and peeks ahead to next year. I caught up with Mike Zuzolo, President of Global Commodity Analytics in Atchison, Kansas.
2019 was not good for most sectors of the U.S. ag economy, including the protein sector. “No, it wasn’t,” Zuzolo says. “Given the packer break-evens being in the hundreds of dollars for much of the year in cattle, and given the cash prices of hogs struggling to get above $50 live prices, as well as seeing that African Swine Fever was decimating half of the world’s hog herd, I’d say 2019 was a very big disappointment to the cattle and hog industry.”
He said the challenges didn’t just include the trade troubles that dominated headlines throughout the year, they also included a major fire at a Cargill plant in Holcomb, Kansas. Zuzolo said that shot cattle prices sharply lower.
“Prices went below break-evens and they didn’t recover for several weeks,” he recalled. “In my opinion as a livestock analyst, it really shouldn’t have hit the markets quite that hard. The market saw cash prices for cattle collapse from around $120 to $100 for several weeks. At the same time, ground beef and boxed beef prices shot sharply higher because of expectations for tighter supplies.”
Cattle producers took a major hit at that time. The good news is I want to leave you is that Zuzolo sees potential for several bright spots ahead for the protein sector in 2020.
You can find Mike’s website at https://globalanalytics.wpcomstaging.com/
