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September 2022 - National Cattlemen

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N A T I O N A L CATTLEMEN

To be the trusted leader and definitive voice of the U.S. cattle and beef industry. SEPTEMBER 2022 • Vol. 38, No. 12 • NCBA.org

MARKET SNAPSHOT WEEK OF 8/22/2022

CURRENT VS. LAST YEAR SOUTH CENTRAL 500-600 LB. STEERS

$195.12

$167.84

16.3%

LIVE FED STEERS

$125.47

17%

$146.76

CHOICE BOXED BEEF

$338.93

21.9%

$264.58

OMAHA CASH CORN

$6.15

18.9%

$7.31

IN THIS ISSUE 4

FARM WORKER SAFETY

5

POLITICAL OUTLOOK

Use these practices to ensure workers are safe when handling and moving cattle.

Expectations for the 2022 election cycle for the Senate and House of Representatives.

8-9

MARKET REPORT

As beef prices remain high, what to expect from U.S. beef imports and exports.

10

WEATHER

14

CHECKOFF

15

FEDERATION

Drought is present across the globe in Europe and South America. This veteran-turned-farmer has a story that caught the attention of national news outlets.

NATIONAL CATTLEMEN’S BEEF ASSOCIATION 9110 E. NICHOLS AVENUE, SUITE 300 CENTENNIAL, CO 80112

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HATTIESBURG, MS PERMIT 142

PRSRT STD US POSTAGE

Parents pack beef in backpacks as students return to the classroom.

From Rangeland to Railyards NCBA Addresses Supply Chain Challenges The COVID-19 pandemic impacted nearly every facet of American industry from healthcare to manufacturing. While some of those impacts have subsided, shortages and supply chain issues continue to plague our nation and particularly the agriculture and food sectors. Like everything else, supply chain concerns escalated early in the pandemic, initially due to outbreaks in the workforce and the residual labor shortages at packing plants, in the transportation and shipping industries, as well as at grocery stores and restaurants. Between sick employees being unable to work and the surge in online purchases from homebound Americans, supply chains were simply overwhelmed by demand and could not keep up. This caused a backlog of goods needing to be shipped to and from the United States and around the country, which grew exponentially when combined with labor shortages in the trucking, shipping and rail industries. According to Global AgriTrends Co-Founder Brett Stuart, the reason behind the supply chain’s lack of preparedness is due to companies’ desire to increase efficiencies through ‘just-in-time’ inventory deliveries. “For years, just-in-time inventory was the new thing, and all these years that worked; we just never had a problem,” Stuart said. While adopting ‘just-in-time’ delivery by freight companies was effective pre-COVID, their inability to adapt as demand rose and labor fell proved troublesome to say the least. More recently, these supply chain issues, along with new challenges like the Russian invasion of Ukraine, have sent the agriculture industry scrambling to distribute commodities like grain that are critical to feeding livestock and people alike. Grain shipments have experienced a particularly challenging choke point in the railway industry. Despite producers’ stockpiles of feed and grain, some are a single missed or late shipment away from running out of feed. According to the American Farm Bureau Federation, rail companies BNSF and Union Pacific have shipped 9% and 14% fewer grain cars in the second quarter than in the first, respectively, not to mention the combined 143,000 additional unfilled orders

year-over-year. In addition to an increased scarcity of railcars, producer bids for shipping services have increased 552%..1 The result — “paying more for less” — is draining producers’ pockets and patience. Prior to the pandemic, trucking companies struggled to find drivers, partially due to the undesirable nature of being on the road for long periods and away from home. “[Trucking] is a change in lifestyle, and part of it is that people are just unwilling to do that,” Stuart said. “I think too, the COVID-19 stimulus payments raised everyone’s expectations of standard of living, [with people] saying, ‘There are things I don’t want to do that I don’t have to do.’” Adding to the overall difficulty of the trade, some drivers just don’t want to deal with the numerous regulations within the trucking industry, and the economics are not always enticing to draw more drivers in. Newer federal regulations like the required use of electronic logging devices (ELDs) which track a driver’s daily of hours-of-service (HOS) have also contributed to the problem. The livestock hauling sector has been exempted from the ELD mandate since their introduction due to Congressional action. “Before that, we had trucks on the road 24/7,” Stuart said. “All the sudden, we only have trucks on the road during the day because the drivers shut down at night. It was like we eliminated a third or more of our entire trucking logistics.” The combination of these stricter regulations with the worsening driver shortage and increased shipping demand yielded the service backlog we see today. “We do a few of these regulatory things, we cut total hours down, we overload the supply chain, and we have sick workers unable to work. It was just the perfect storm that broke an already fragile system,” Stuart said. Last winter and springs’ port congestion also played a role in the global supply chain, tying up containers, ships and dock space. While this was still somewhat due to the combined shock of labor shortages and increased demand, empty shipping containers heading back

Continued on page 7

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