06-25-2008, 04:36 AM
I should have worded this bettter:
"He sells his livestock, lowering supply and further raising the price of meats"
Perhaps, I should word it this way, "He sells his livestock, lowering animal stocks and further raising the price of meats".
The sell off of livestock can create short lived price downturns in meat. Keep in mine, meat products have a short shelf life. Processed products move to the end users quickly. The over supply is gone in a a few weeks. Rarely passed on to consumers.
As prices at the grocery store increase consumers buy less and the lower animal stocks are less of a factor. The price to the farmer doesn't rise because of lower consumer demand.
The key here is animal stocks. To replaced the hamburger you buy in the store will take the farmer two years+. As a business man the farmer, has to consider is the risk worth it in an uncertain and volatile market. Currently, the better decision is to sell his corn and go on holiday.
The majority of beef continues to be fatten in " feedlots" with corn.
There is a segment of grass fed beef. Even these animals are feed corn as a supplement to promote growth.
Grass doesn't have the protein of corn, so the process of fattening an animal for market takes much longer. Slower return on investment. Production of grass fed beef uses many more acres of farm land, a luxury many producers do not have.
Food for thought
"He sells his livestock, lowering supply and further raising the price of meats"
Perhaps, I should word it this way, "He sells his livestock, lowering animal stocks and further raising the price of meats".
The sell off of livestock can create short lived price downturns in meat. Keep in mine, meat products have a short shelf life. Processed products move to the end users quickly. The over supply is gone in a a few weeks. Rarely passed on to consumers.
As prices at the grocery store increase consumers buy less and the lower animal stocks are less of a factor. The price to the farmer doesn't rise because of lower consumer demand.
The key here is animal stocks. To replaced the hamburger you buy in the store will take the farmer two years+. As a business man the farmer, has to consider is the risk worth it in an uncertain and volatile market. Currently, the better decision is to sell his corn and go on holiday.
The majority of beef continues to be fatten in " feedlots" with corn.
There is a segment of grass fed beef. Even these animals are feed corn as a supplement to promote growth.
Grass doesn't have the protein of corn, so the process of fattening an animal for market takes much longer. Slower return on investment. Production of grass fed beef uses many more acres of farm land, a luxury many producers do not have.
Food for thought