AMES — An Iowa State University livestock economist says at the current point in the beef production cycle, the number of cattle should be leveling-off. That would usually mean lower prices — but as Lee Schulz looks ahead to 2020 — he sees better prices than the ones today.
“That’s certainly setting up that we could continue to hold inventories or not see very large declines or liquidations of the cattle herd because of those supported prices in the horizon,” Schulz says.
Schulz says export sales grew by double-digits in recent years, and a bit more modestly in 2019. The new trade deal with Japan and the likely implementation of a new North American agreement could keep beef exports strong in 2020. On the pork side, 2019 included ongoing tariffs on Chinese imports of U-S pork. But the year also saw the unprecedented African swine fever outbreak claim more than half the pigs in China, which pushed the country to go shopping for more pork on the world market.
Schulz says China started buying more pork from the European Union but it eventually turned to the U-S, too. “We’ve seen the U-S really ramp-up exports to China as well as back-filling other places that maybe weren’t getting exports from the European Union,” he says.
African swine fever has not been found in North America. But Schulz says the threat of it has prompted many farmers to pour profits into shoring-up biosecurity, which has the added benefit of reducing the spread of existing diseases, too.