Last night during a press conference, President Trump announced he has asked the Department of Justice to look into the disparity between cattle prices and record high boxed beef. Trump said, “it shouldn’t be that way. Supply and demand should not allow that to happen.”
The response came after the President said he recently had a talk with the owners of some processing plants. Trump recalled it as “a very strong talk, and I think they got the message.” He added he anticipates in a week and a half or maybe sooner, “…we will be in great shape.”
President Trump was joined by Vice President Mike Pence, U.S. Agriculture Secretary Sonny Perdue and Iowa Governor Kim Reynolds during the sit-down press conference as they discussed testing and COVID-19 in respects to manufacturing and processing plants. Governor Reynolds pointed to Secretary Perdue and said, “…they have definitely turned a corner.” Perdue agreed and said, “…we will see stores with more variety in meat departments and fully supplied soon, within a week to ten days.”
Vice President Pence joined in and attributed meat processing plants remaining open to President Trump’s executive order that utilized the Defense Production Act. That executive order labeled meat processing plants as “critical infrastructure” and will force the plants to follow Center for Disease Control (CDC) and Occupational Safety and Health Administration (OSHA) guidance to remain open and in operation.
The executive order was directly related to the limited amount of cattle and hogs being slaughtered. As of Wednesday, USDA said 82,000 head of cattle were slaughtered across the U.S. which is about 31.1 percent lower than year ago levels. The USDA chart also estimated cattle slaughter as of May 2nd at 425,000 head, about 37 percent lower than the 673,000 head for the same time period last year.
The limited slaughter pace has driven the value of boxed beef to records highs. Since mid-April, choice cutout values have risen over $220 with the current numbers just shy of $460.
Northern Ag Network – 2020