FOCUS ON AGRICULTURE: High beef prices mean time to invest in better genetics

Posted: Aug. 14, 2014 8:56 am Updated: Sep. 11, 2014 1:15 pm

With high prices, it's easy for beef producers to avoid making changes. But by planning now, herd owners can prepare for low prices ahead.

"In cattle cycles prices go up -- and down," said Scott Brown, University of Missouri economist. "With volatility, rebuilding cow numbers will face challenges."

Owners are responding to high-price signals. They've saved heifers for breeding at a rate similar to a herd upturn in the 1970s.

"We can build cow numbers quickly," Brown said. "That is different than building beef supply quickly. It takes time to bring calves to the feedlot, packing plant and finally to consumers."

Brown advocates not just adding cow numbers but improving beef quality. Consumers have learned to like higher-quality beef. And they show they'll pay more for USDA prime grade beef.

Brown's price charts show premiums for prime beef remain less volatile than for choice, the next lower grade. Select, a grade below choice, remains the lowest-priced.

Improvements can be made in meat quality by selecting genetically proven sires.

Better genetics help boost returns from a cow herd -- and differences in profits can make a difference in farm survival at the bottom of the next price cycle.

"There's a difference between cattle prices and cattle profits," Brown said. "Building quality genetics reduces risks. Quality meets a growing consumer demand for prime beef."

There's a world of producers who raise commodity beef. U.S. cow herd owners remain slow in adopting new ways. "Those who adopt new technology may get risk mitigation," Brown said.

Price report

A group of University of Illinois Extension local food systems and small farms educators have collaborated with the University of Kentucky's Center for Crop Diversification to create an Illinois farmers market price report.

The University of Kentucky center has compiled price reports for farmers markets and produce auctions around Kentucky since 2005. In 2013, faculty and Extension personnel at the University of Tennessee started reporting prices from farmers markets with assistance from the Kentucky center.

"This year, Illinois became a partner with the center to create our own statewide price report," said Deborah Cavanaugh-Grant, a U of I Extension educator.

Price reports are shared to help farmers learn about prices that are charged at farmers markets or produce auctions for common products, Cavanaugh-Grant explained.

"Having access to this pricing information allows farmers to better understand how to set prices that support profitability of their farm while remaining fair to consumers and competitive with other producers," she said.

U of I Extension will collect data at 11 markets throughout Illinois from Machesney Park to Harrisburg, Quincy to Urbana. Each week Extension educators, program assistants and/or Master Gardener volunteers will collect information about the vegetable and fruit crops being sold. An average price for each commodity is reported for each of the markets based on information from each vendor at each market. Price information from each of the markets is then aggregated into a weekly report.

The price report is available online at

-- Compiled by Herald-Whig Staff Writer Deborah Gertz Husar