Where’s The Beef? Texas Wildfire Impact on Prices and Supply
The attention of America turned to the damage caused by the record-setting wildfires that ravaged the Texas Panhandle in late February, including the Smokehouse Creek fire, with an estimated $102 million in growing losses associated with cattle ranching. More than 85% of Texas’ cattle industry, worth $15.5 billion – about 18% of the U.S. industry as a whole – is concentrated in the state’s panhandle.
For those ranchers the impact goes beyond the $15,000 to $20,000 or so per mile to replace fences, or the feed and grass that was destroyed and will take over a year to grow back.
According to Andy Holloway, the Hemphill County Agent for the Texas A&M AgriLife Extension and lifelong rancher, his county and neighboring Roberts County each lost about 7,000 mother cows. Holloway calls these animals “factories” because of the valuable next generation of livestock they produce during calving season. Every mother cow that died meant losing “two animals because of the cash crop that was about to be born,” he said.
While devastating for local Texas ranchers, the wildfires alone are not expected to have a significant impact on the nation’s beef supply. But the disaster couldn’t have come at a worse time. Ongoing drought conditions and the COVID-19 pandemic have already led to a surge in prices for key cattle feed ingredients. Consequently, farmers are unable to support as many cattle, leading to scarcity and subsequent increases in beef prices.
In 2023, beef cattle market prices reached record highs. Additionally, just a month before the wildfires erupted, the USDA announced a record low inventory for the American beef cattle industry, with numbers dropping to 28.2 million head, the lowest level since the 1970s.
For LA Foods, maintaining a reliable, affordable, pipeline of beef products in the face of ongoing fluctuations will remain a challenge, especially since American consumer demand even at higher prices remains constant.
“We are tenacious when it comes to fulfilling our customer’s orders,” said Larry Schwartz, Director Of Business Development for LA Foods. “We have to be because even with lower supplies and higher pricing, beef is still the second-highest consumed animal protein at almost 58 pounds per person annually. That’s the demand and it’s our job to come up with the supply.”