Beef prices in Tennessee and Kentucky are reaching record highs, according to agricultural officials. Both states are at the center of the mid-South and represent a major part of the American beef trade, ranking ninth and eighth in beef production respectively.
The record beef prices are largely the result of a current imbalance between supply and demand. According to reports by the University of Tennessee, despite an overall reduction in cattle by 40,000 the state still experienced record prices over the past year. These high prices, some officials fear, could be dangerous to the beef industry, a situation that University of Tennessee professor of agricultural economics Emmitt Rawls described as, “kill[ing] the goose that laid the golden egg.”
The danger, Rawls and other economists believe, is that farmers may make a financially prudent decision to capitalize on immediate high prices rather than investing in riskier herd management. With the number of U.S. cattle at their lowest in decades, the immediate risk of oversupply driving down prices is gone, pushing many farmers to sell their herds rather than making long-term gambles to increase the size of their herds, a decision that could be undone by future price fluctuations.
The uncertainty is palpable in many farmers’ reactions to the high prices. According to the head of the Kentucky Cattlemen’s Association, “We never have seen prices like this. These are uncharted waters for the average farmer. And we just don’t know where it’s going to end.”
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Written by: Justin Ellison / Farm Plus Staff Writer