The Free Press, Mankato, MN

October 17, 2013

S.D. cattle deaths unlikely to hike prices

Minnesota cattle producers expanding rapidly

By Tim Krohn tkrohn@mankatofreepress.com
The Mankato Free Press

---- — The unexpected blizzard that hit South Dakota and killed cattle was devastating to ranchers there but is unlikely to affect consumer prices for beef. And those ranchers’ misfortune will likely benefit many Minnesota producers who raise calves and breeding stock that will be in demand by South Dakota ranchers.

The number of cattle lost in the Oct. 4 blizzard is unknown, with estimates ranging from 20,000 to more than 150,000. With 3-5 feet of snow that began to melt, followed by more snow last weekend, ranchers are just beginning to get to the remote ravines and hills where cows perished. The state has about 6 million head of cattle.

Whatever the final number, the chair of the Minnesota Beef Council board of directors said it’s unlikely to raise prices.

“If you put it in perspective, during the drought in the summer of 2012 in Texas, they sold off 600,000 head,” Mark Malecek said. “I’m not underestimating how it affected those ranchers — the younger producers are going to be hurt the worst — but it’s not going have much effect.”

Dennis Wick, owner of Hilltop Meat Market in Mankato, hasn’t seen any price increases so far for cattle he buys. “The price hasn’t changed recently at all.”

And while beef, pork and other prices did spike in the summer of 2012 because of drought and high feed prices, Wick said the increases weren’t as big as many predicted.

“Beef has stood at the same price from last summer to this summer — $2 a pound hanging or $1.10 to $1.20 for live weight.”

Wick made a call to his buffalo supplier in Rapid City this week to see how bison fared in the storm. The more hardy animals apparently did well.

“He said some people lost a few, but he didn’t hear of many.”

Malecek, who raises cattle near Redwood Falls, said the cattle business in southwest and western Minnesota and the Dakotas is in a revival, with packers expanding plants, new herds being started and existing producers expanding.

“The big thing is we can buy the feed grains here. We can buy the wet distillers grain (an ethanol byproduct). They can’t compete with us in the South anymore because of shipping the feed grain,” Malecek said.

He, too, said beef prices haven’t been rising since the 2012 drought bump. “There was a high last year but it’s been lower since.”

Still, he said producers are very optimistic as they grow herds and see increased demand domestically and in export markets.

Minnesota ranks 10th in cattle production with 2.38 million head of cattle, including dairy cows, according to Karin Schaefer, executive director of the Beef Council.

Malecek said the Beef Council is holding a checkoff referendum in February aimed at raising more funds to promote Minnesota beef. A checkoff passed in 1986 has producers voluntarily pay $1 per head to the Beef Council with half used for state promotions and half going to the national council.

“We would like to raise it to $2 and use $1.50 to promote Minnesota beef,” Malecek said. (Any producer who would like to vote can go to raisedwithpride.com to get information and a ballot.)

He said they’d also like to use the funds to counter groups attacking the livestock industry. “There are so many factions out there throwing out misperceptions about our industry, and we need to combat that.”