Cattle Market Challenges
Challenges in the cattle marketing are not new, and ICA's emphasis on these issues is not new. The Iowa Cattlemen's Association has been working for years to increase producers' leverage, improve price discovery, and better situate the independent Iowa cattlemen in the fed cattle markets. These issues became even more apparent and urgent with the COVID-19 pandemic. Below you'll find articles and press releases about ICA's cattle market work.
ICA staff and member leaders have worked diligently for months to inform our elected officials on price discovery and the need for solutions to address long standing issues in our cattle markets. Rep. Axne's leadership on the House Agriculture Committee, along with support from Reps. Finkenauer and Loebsack, has helped prioritize this discussion in advance of Livestock Mandatory Reporting (LMR) reauthorization.
The policy passed at NCBA meets some of ICA's objectives, and we consider it a step forward, but it is not a complete victory. There is still much to be done to increase price discovery, and we are disappointed that a solution to this very urgent problem may be delayed once again. The longer that the price discovery discrepancy affects fed cattle producers across the U.S., the more likely it is to also deeply impact cow/calf producers. ICA will continue to work independently of NCBA on solutions.
ICA's Next Steps: The NCBA policy decision does not change ICA's advocacy efforts in any way.
1. We still support Sen. Grassley and Rep. Axne's cash trade bills.
2. We will continue to explore other means of increasing price discovery.
3. We will stay engaged in the NCBA working group and continue to work with other state and national cattlemen's groups.
Price discovery and producer leverage are urgent issues affecting cattle producers in Iowa and across the country. The Iowa Cattlemen's Association hosted a webinar on June 17 with three industry leaders to discuss the current challenges and possible solutions to the problem.
Join ICA staff member Katie Olthoff as she moderates a panel featuring Corbitt Wall, Brad Kooima and Jordan Levi. The group discussed fed cattle marketing trends and how they affect price discovery and producer leverage before diving into industry-led initiatives such as Senator Grassley's proposed 50/14 mandate and "Bid the Grid" concept.
Iowa Cattlemen joined 19 other state cattlemen's organizations to formally request a Department of Justice Investigation into the cattle markets. More info coming soon.
ICA board members have also been involved in many discussions and working groups across the country, exploring a regulatory approach to increase cash trade.
Key topics discussed included the need for more transparency and negotiated cash trade in major cattle feeding states, reauthorization of Livestock Mandatory Reporting, the Packers and Stockyards investigation of beef pricing margins post-Holcomb fire...
When it comes to fed and other types of cattle marketing trades, our position is that increasing the timeliness and the detail of market data is key to providing price discovery for producers and other players in the live cattle market across the country. Read more.
The Iowa Cattlemen’s Association returned from the National Cattlemen’s Beef Association victorious, after garnering enough support to pass two new interim cattle marketing policies at the national level.
Market transparency is on full feed from your Iowa Cattlemen's Association...Our focus is to increase negotiated trade/market transparency up and down the beef belt for the opportunity to leverage competition...
Most of the Cattle Production Committee meeting was focused on cattle marketing, and more specificially, market transparency and negotiated cash trade.
ICA has been working on several longer-term priorities, intended to strengthen Iowa's beef business over time.
Cattle Marketing is always a priority for ICA on the national level. This year, ICA introduced two policies in the Live Cattle Marketing Committee aimed at improving risk management tools for cattlemen.
Over the past several years, the types of cattle marketings (reported through mandatory price reporting) have changed. In the past, most cattle were "cash negotiated," meaning several market participants openly bid on cattle to negotiate the most favorable price for the cattle feeder.
The board adopted policy encouraging that 50% of the cattle in the U.S. be marketed through negotiated cash trade. In Iowa, 60-70% of the cattle are already marketed through negotiated cash trade, but that is not the case in other major cattle feeding regions. The intent of this policy is not to mandate or dictate what any one producer does on theri farm, but to send a strong message that more price discovery needs to happen across the country in order for markets to become more reliable and stable.