California cattle on sale
8:01 pm
Thu May 22, 2014

Drought still taking toll on ranchers, beef prices

Drought has many California ranchers culling their herds and ranchers in other western states are taking advantage.
Credit Luke Runyon/Harvest Public Media

California ranchers, despite near-record beef prices, are shrinking their cattle herds in response to one of the most severe droughts the state has ever faced, and many Western ranchers are taking advantage.

About 150,000 of the 600,000 breeding cows in California have been sold off this year, mainly to buyers in Texas and Nevada, according to the California Cattlemen's Association. Ranchers in other western states, like Colorado are also looking to buy California cattle in order to rebuild their herds up from recent drought in their home states. The Colorado state department of agriculture said nearly 28,000 more cattle have entered Colorado this year from California than in the same time last year.

Terry Fankhouser, executive vice president of the Colorado Cattlemen’s Association, said the influx of cattle to Colorado will not result in a drop in beef prices anytime soon, even in Colorado.

“Last year, in 2013 we saw some record beef price increases – in some cases up to  20 percent increases – but we also saw demand grow by one percent across the country,” Fankhouser said. “One thing I can tell you, in the future beef producers will continue to build foreword and increase that supply which over time will draw that price back down, but for the foreseeable future I think beef prices at the retail counter will stay at least as high as what they are today.”

Fankhouser said the demand for beef continues to increase in both American and Asian markets like China, Vietnam and India as more people entering the middle class want to eat more beef.

“We’re confident that the demand is going to be somewhat overwhelming in those countries that they’re really going to have to be responsive to that,” he said.  “They raise a tremendous amount of poultry and pork, but they really don’t raise much beef.”

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