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Cold, drought and COVID-19 could drive up consumer cost for beef

Cattle at La Junta Livestock
Posted at 7:52 PM, Feb 16, 2021
and last updated 2021-02-16 21:52:39-05

LA JUNTA — The record cold in Colorado and across the mid-west will likely have an impact on grocery bills in months ahead. Ranchers losing calves to the cold adds to losses they have been experiencing from drought, as well as the politics of COVID-19.

La Junta Livestock is a 3rd generation family business in Colorado’s eastern plains. Jace Honey is the current President and Manager. In his years of being part of the cattle business he says there are three things that effect the cattle market. "Weather, supply and demand, and politics." This year there has been all three.

Politicians made some sweeping decisions because of the pandemic. Honey is not saying it was wrong, but basically shutting down restaurants for months cut off a large revenue source in the beef industry "The prime cuts of our beef does not move as much. They go to restaurants."

Now, there is record breaking cold across dozens of beef producing states. "Their calves are freezing to the ground, they can't get up. The cow can't clean it as good and so you have death loss on your calf crop,” said Honey. He thinks the loss could be as many as 5% of calves lost.

The freeze is part two of weather problems. Ranchers were already dealing with drought and the effect on their cattle herds. "They didn't breed so we've go to get rid of some of them,” said Honey Herd sizes are dropping as much as 15% due to drought.

It becomes a math equation and an example of supply and demand. Herds shrinking 15% and then losing 5% of new calves means a significant supply deficit. "As far as consumers short term right now…the meat should get higher just because of the simple fact, packing houses that butcher cattle they can't get it to retail stores."