Part 4: Rabobank Global Animal Protein Outlook

Today we wrap up a four-part series featuring Rabobank, the beef and cattle market has faced cyclical and capacity imbalances, and, a major focus is how to eliminate that for a more steady, streamlined production model. Rabobank’s, Senior Animal Protein Analyst, Lance Zimmerman.

“We do have a situation playing out where processors have capacity available to them to utilize certainly compared to where we were two years ago, you know, as we came out of COVID, we had an abundance of cattle and not enough hook space for all those cattle that we've produced based on where we were sick, luckily, but also cattle that had been backed up in the supply chain just a little bit due to some of the processing delays coming out of COVID. As we go forward, we have a lot more capacity that's being planned. And that's going to continue to come online over the next several years. One of the biggest things that we have to focus on as an industry going forward is how do we not create an infrastructure where all of our individual segments of production operate in a boom or bust environment. But going forward, what we need to do is make sure that as an industry, we kind of work together hand in hand to make sure that we can have a more coordinated supply chain going forward so that we can eliminate some of those pain points that we've created with cyclical imbalances over the past two dozen years.”

Zimmerman says the cattle market is currently in the middle of a cycle demand is strong and profitability is returning.