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Producer’s share of the retail dollar on the decline

The cattle producer’s share of the retail dollar has been on a steady decline since the start of the year.

University of Missouri livestock economist Scott Brown says in January producers received about 47 percent of the retail share of the dollar, but July data shows that’s dropped to about 40.5 percent.

And he says, that’s likely decline even more.  “When you see what’s been happening in these cattle markets after the Tyson fire,” he says.  “We know that share of the consumer dollar is likely to go down as packers end up with a larger share of that.”

He tells Brownfield when cattle supplies were tight, about 56 percent of the retail dollar was making its way back to producers.  “It does ebb and flow in terms of who holds the cards when it comes to slaughter runs vs. slaughter capacity.  But, it took for a turn for the worse for producers last week.”

The Tyson facility in Holcomb, Kansas accounts for about 5 percent of the daily beef slaughter capacity in the US.  And Brown says until that plant comes back fully online, the beef sector could continue to pressure slaughter capacity constraints in the US.