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Effect of COOL’s Repeal

Below is a message from R-CALF USA CEO, Bill Bullard:

Here is a chart showing what has happened to our markets since the repeal of COOL.  Average per head packer margins increased 84% after COOL’s repeal.  We suspect that much of the imported beef that packers were stockpiling in cold storage was sold after COOL as USA products, and with ongoing imports also mislabeled as USA products the packers have been accorded a formidable tool to capture more of the producers’ value of cattle.  Using the data from the chart, the percentage of the animal the packers retained was about 7.6% when COOL was in place.  After COOL, the average percentage of the value of the animal that the packer captured more than doubled, to 16.4%.  These data are only through May 18, 2018, so the percentage is likely higher than that today.

Bill