CALF_News_February_March_2021

11 CALF News • February | March 2021 • www.calfnews.net The First Hydraulic Corral and still the Largest! • Pull on highway at speed limit. • Fits through any gate your pickup will. • Stable on uneven terrain. • Wheels on each panel and electric over hydraulic jack eliminates lifting—saves time. • Permanent sheeted adjustable alley. • Frame gates for sorting. • Transport wheels are permanent, no sliding off the axles and rolling out of the way. Rawhide Portable Corral 900 NORTHWASHINGTON ST., ABILENE, KS 67410 785.263.3436 www.rawhideportablecorral.com Rawhide Processor by John McDonald 3 Sizes Available! insurmountable and make the risk exceedingly high. Large packing plants take advantage of the principle of econo- mies of scale. They’re able to distribute their significantly fixed costs over thou- sands of head per day. The capacity is also what leads to their negotiating power. A smaller plant does not have the same capacity to distribute its fixed costs. “A second challenge is the status of the cattle market. The 2020 cowherd was smaller than the 2019 cowherd. We can expect that trend to continue for three to seven years, depending on this run of the cattle cycle. Fewer cows mean fewer calves, which means that, on an annual basis, we expect increasing prices for feeder and fed calves until we reach the next peak of the cattle cycle.” What does this mean for a new packer? “Each year, potentially for the next seven, their input prices will continue to rise as all packers compete for fewer calves,” Benavidez says.“The economics won’t improve for them any time soon. These are the same conditions that eventually led to PACKING INDUSTRY FUTURE Continued from page 7 the shuttering of the Cargill Excel Plant in Plainview in 2013.” Issues facing large-scale packers will continue. They need to recognize how their business dealings impact producers and feeders, and vice versa. After all, when cattle numbers were tight and producer profits were $100, $200 and even nearly $500 per head five years ago, packers were squeezed. Other industries can learn from packers when dealing with mega issues like COVID- 19. The North American Meat Institute reports that infection rates among meat and poultry workers were five times lower in December 2020 than in May, while rates in the general population rocketed up by nine times in the same period. The institute states the meat and poultry sector averaged about 19 new reported cases per 100,000 workers per day in December. That compares to a new case rate for the U.S. population of about 63 cases per 100,000 people per day. This data shows how the packing industry “is protecting the selfless men and women who have kept Americans’ refrigera- tors full and our farm economy working throughout this crisis,” the institute states. They are essential workers for an industry that completes the supply chain from pasture to plate. And packers, pro- ducers and feeders are essential to each other, even if one is cussed more often than not.  Packers kept retail meat cases filled when foodservice outlets were locked down.