Why is beef so expensive?

[Trochu]

Originally Posted by MountainTi

Machinery costs are thru the roof.
John Deere's new 9RX quad track is $1.6 million. Not hard to spend 1.3 on an X9 combine.

Tell that to the price of wheat and barley!

[DRhunter]

Originally Posted by Smokinyotes

Even the price of bulls now to breed the cows that raise those beef calves is getting crazy. You can spend 15-20g just to get a decent bull. Over a $1000 for hay/ cow per winter. Pasture rent for 5 months is +-$300/cow. New balers are right around $100g. Even at $2500 a calf right off the cow the profit margin is pretty slim.

I understand all of us in Ag want to do the “woe is me routine” but in all honesty, if you aren’t making a major profit margin with calf/cattle prices today, you should probably be taking a very serious look at your operation or consider getting out of the cow calf business. If you are wintering cows for $1,000+ (when hay is around $200/ton), I can almost guarantee you should not be in the cow/calf business because these cattle prices will not last forever.

These are the years that sustain us through the tough ones where we break even or have some losses. If you are barely breaking even now you are going to be in serious trouble when cattle prices correct.

All I can say is “lord just give us one more cattle boom and we promise we won’t **** it away this time”

DR


Sent from my iPhone using Tapatalk

[NCC]

There's money in cows now but it's expensive to raise them and just like barley and canola prices have dropped 50% in the past two years, calf prices will also drop.

I figure $4/day to winter a cow and $2 for grass, so that's ~$1100/year for the feed. Add interest on a couple million dollars worth of land and buildings, interest and depreciation on a million dollars worth of equipment, land rent, diesel, labour, power, gas bill, taxes, death loss, open cows and bull power, and it takes a lot of cash to get a calf to market.

Hay's $0.11/lb this year and barley is about $4.60/bu. I'll make more profit off of a hay field that goes 4 bales/acre than I will off of a 100 bu/acre barley crop. I think many farmers will be underseeding their wheat and barley next spring and trying to get into cows. With current prices a properly managed grazing operation is likely more profitable per acre than a grain farm.

[W921]

Originally Posted by DRhunter

I understand all of us in Ag want to do the “woe is me routine” but in all honesty, if you aren’t making a major profit margin with calf/cattle prices today, you should probably be taking a very serious look at your operation or consider getting out of the cow calf business. If you are wintering cows for $1,000+ (when hay is around $200/ton), I can almost guarantee you should not be in the cow/calf business because these cattle prices will not last forever.

These are the years that sustain us through the tough ones where we break even or have some losses. If you are barely breaking even now you are going to be in serious trouble when cattle prices correct.

All I can say is “lord just give us one more cattle boom and we promise we won’t **** it away this time”

DR


Sent from my iPhone using Tapatalk

In my neighborhood it's been a great year. Spring rains!!! We got a hay crop. My stack yard is full. I have cows here that don't know what a bale of hay is because they have been wintering on barley straw all through drought.
Rains stopped and grasshoppers again. Talking about input costs. A gallon jug of coragen insecticide was over $1600. That's for about 4 liters of it.
I think feed barley will be cheap this winter. Yes its a good year for cow/calf guy's but no way I would buy heifers at these prices or try to expand.
I'm not even baling barley straw right now. I don't think it will be worth anything. Not for me to buy it for fertilizer value from someone and mess around baling it because hard to bale from rotary combines and I know straw will be to plentiful this year. Round bales of hay are selling for $100 right now. Last year they were in the $275 range.
Yes machinery costs are crazy. New prices plus what is shop labor rates $160 hourly? I just spent $4000 on a few parts on my pickup on my baler. Crazy but cost of a new one is out of this world.

[W921]

That coragen was actually a 2 liter bottle not a 4liter. Just think over $1600 for 2 liters of insecticide.

[lannie]

Originally Posted by W921

That coragen was actually a 2 liter bottle not a 4liter. Just think over $1600 for 2 liters of insecticide.

It's not how much it is per litre its how much per acre I thought?
Coragen is appprox 12 to 25.00 per acre for application.

[Ackleyman]

Originally Posted by W921

If u buy local beef from a producer or small meat shop it tastes way better than what you will buy retail. Walmart or especially Costco is cheaper but the quality is not there and I'm not sure why or what they do to it.
Fuel costs has a lot to do with prices. And it's not just from ranch trucks or chore tractors. That's small part of it. Fuel or oil prices drive up everything.
We only have two big packers in western and they own enough cattle of their own they can kind of manipulate prices.The boxed beef that they sell to grocery stores is another part of it. All these things are complicated and hard to explain in a few paragraphs. Boxed beef and government regulations really took out all the small butcher's and give multinationals control over everything.
In agriculture you can do everything right and go bankrupt. Takes crazy money to get such a small return.
Inflation has gone so crazy I'm not sure if a lot of people even know if they are making money or not. Example someone doing custom work. Inputs have gone up so much since covid you can be making twice as much and maybe losing twice as much and not knowing it yet. Example net wrap that was $100 a bale before covid is now $300. A bearing that use to cost $250 is now $900. Etc.

I wouldnt compare Walmart to Costco. Any steaks , loins i get from Costco are pricey but superb to most other stores. Even our local butcher , sometimes a good cut , sometimes not so good.

[Sporty]

Originally Posted by Fradaburidi

I know everything is expensive these days but beef seems to be over the top.

To me it seems that the same cows graze the same pastures even in the dead of winter with no extra work.
I must be wrong and it should be more than that to it so that's why I'm asking.

In any case, it became a delicacy.

A quick google search could answer the question for you. Here are a number of factors involved with beef prices in Canada. Droughts have made feed scarce, so ranchers have had to reduce their herds, which means less beef available. On top of that, supply chain issues, labor shortages, and higher fuel costs are driving prices even higher. Throw in inflation, a weaker Canadian dollar, and strong global demand, and it all adds up to the higher prices we're seeing at the store.

[Smokinyotes]

In put costs are crazy. I seeded down a hay field this spring. Not counting any fuel I have $152/acre in to it for just seed, fertilizer and floating. Cattle prices need to remain strong for the average farmer to keep operating. If everything remains the same price and calves drop to $1200 there will be a lot of guys calling it quits.

[The Cook]

I paid $5.00/lb to the rancher and $1.15/lb to the butcher. I always cruise the meat dept when shopping and have seen Two nicely marbled rib steaks for $70.00. Support Local, they might even let you hunt their land.

[El Carnicero]

I'm at a plant today that is selling sides of beef for $4.25/lbs wholesale.

Most plants I'm working around are selling sides for $5.49/lbs Cut, wrapped and Frozen.
Pork is sitting at $2.09/lbs cut and wrapped.

Prices are ridiculous. Thank goodness I hunt otherwise we wouldn't be eating meat.

[W921]

Originally Posted by lannie

It's not how much it is per litre its how much per acre I thought?
Coragen is appprox 12 to 25.00 per acre for application.

Coragen on Ufa website is over $1600 for the little jug.
Custom high Clarence spayers or one I talked to is $1000 an hour but that's not for Coragen. I forget if he was using labamba silencer or malathion which is a lot cheaper but not as effective on big hoppers.

[W921]

Originally Posted by Sporty

A quick google search could answer the question for you. Here are a number of factors involved with beef prices in Canada. Droughts have made feed scarce, so ranchers have had to reduce their herds, which means less beef available. On top of that, supply chain issues, labor shortages, and higher fuel costs are driving prices even higher. Throw in inflation, a weaker Canadian dollar, and strong global demand, and it all adds up to the higher prices we're seeing at the store.

The money that gets made is not the producer. It's the packers and the grocers.
Sure there are rich guys with cattle but they either started rich or made their money with something else or married into or inherited a good start.

[kingrat]

I don't get who's buying steaks at these prices? And roasts.

[glen moa]

I wouldn’t be surprised if some of the high price stuff that doesn’t sell gets ground.
What’s for dinner? I say what’s on sale?

[Roadhunter]

Not a farmer but my best friend is so I know how much it costs to keep a farm going. Some years are great like a couple of years ago when he was getting 100 bushels per acre (I am being conservative) for either wheat or barley.

That was an exceptional year compared to normal and this year will probably be about 1/2 that. Input costs are not going down and sometimes you ROI is not the best.

Does he plan on doing something else? Not likely, it is a pretty good lifestyle (grain farming) and his gross income has one more decimal point than mine and lives a pretty good life.

Not jealous as he has a lot more stress working with big numbers.

I would swap in an instant.

[esher]

How does your net income compare.

[fishtank]

Look for local flyer deals ….. last month brought some prime rib for $10lb , they have gone up a bit since last year but usually on sale at superstore every few months. Then just cut wrap it yourself .

[Grizzly Adams1]

Originally Posted by Trochu

Tell that to the price of wheat and barley!

Lest we forget, farmers are price takers at the mercy of the market.

[6.5 shooter]

Originally Posted by Grizzly Adams1

Lest we forget, farmers are price takers at the mercy of the market.

^^ THIS ^^^^

61% increase on posts, barb wire, baler twine, machinery, fuel, spare parts, lumber, heating, grain drying, electricity, mechanic services .

5% mortality (if your lucky) at calving time, lost sleep, misc. calving paraphernalia, repairs to barns etc. Vet bills, 20% rotation of older cows out, two years of feeding a replacement heifer till she produces a calf. So feed costs at what $200? bucks a ton and she eats ~2 ton a year. You do the math. Many other expenses not included in this brief list. And a federal government that wants to charge even more "green" tax's?

The buyers, feedlots and packers set the price (and all want to make a profit) and the retail stores charges the rest. Yet the rancher get pittance for his work and time. They don't do it for the money!

[gman1978]

Originally Posted by 6.5 shooter

^^ THIS ^^^^

61% increase on posts, barb wire, baler twine, machinery, fuel, spare parts, lumber, heating, grain drying, electricity, mechanic services .

5% mortality (if your lucky) at calving time, lost sleep, misc. calving paraphernalia, repairs to barns etc. Vet bills, 20% rotation of older cows out, two years of feeding a replacement heifer till she produces a calf. So feed costs at what $200? bucks a ton and she eats ~2 ton a year. You do the math. Many other expenses not included in this brief list. And a federal government that wants to charge even more "green" tax's?

The packers set the price and the retail store charge the rest. Yet the rancher get pittance for his work and time. They don't do it for the money!

You’re right, I think the biggest risk to Ag moving forward is political. Don’t under estimate the farmer and rancher, as tough as it can be many farms are very profitable and prosperous. Farmers and Ranchers are smart people, they know how to make a go of it. It’s a complicated business these days but between agronomists, accountants and bankers they have it figured out. I know in many rural areas if it wasn’t for the farmer and rancher supporting the local business’s there would not be much in these small towns. A lot farms have grown in the past five years with new shops, homes and equipment being purchased, it all has a positive trickle down effect in the communities.