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Banner year for Baker beef
By JAYSON JACOBY
Baker County's biggest industry had a banner year in 2011.
The industry is beef cattle.
And gross sales from the county last year totaled $50.8 million.
That's the highest figure on record, topping the previous mark of $49.3 million in 2007, according to the Oregon Agricultural Information Network of the Oregon State University Extension Service.
Sales rose by almost $8 million in 2011 compared to the previous year.
"It's pretty easy to be optimistic right now," said Bill Moore, a cattle rancher in the Burnt River Valley in southwestern Baker County.
"There's a lot of competition for our product," said Moore, who served as president of the Oregon Cattlemen's Association in 2008-09. "It's good for the county and the economy. We run a lot of cattle in Eastern Oregon, and when we can pay the bills I won't say it trickles down, more like it gushes down."
Cal Foster, who with his wife, Vickie, runs a ranch in Bowen Valley, just south of Baker City, said the sense of optimism that Moore mentioned seems to be widespread.
"Everybody I know is tickled pink about conditions," Foster said. "I just don't know if it's sustainable. But maybe I'm just too pessimistic."
Curt Martin, who runs a ranch near North Powder and is the current president of the Cattlemen's Association, said he recently returned from a national ranchers' convention in Nashville, Tenn.
The excitement among ranchers about the industry was palpable, Martin said.
"I'm very bullish on the cattle business and for that matter on all agricultural commodities," he said. "The worldwide demand for our products has, for now, exceeded the supply."
Martin said the economists he has spoken with lead him to believe the favorable market conditions are likely to persist for at least the next two years, and possibly longer.
Several factors have contributed to the beef cattle boom.
But the basic formula combines solid demand for beef — especially in foreign markets — with a U.S. cattle herd smaller than it's been since the Eisenhower administration.
That formula produces higher prices for beef — both on the hoof and in the supermarket.
The average U.S. retail price for a pound of hamburger rose from $2.38 in December 2010 to $2.92 in December 2011, according to the U.S. Department of Agriculture (USDA).
And in January of this year, the USDA reported that the nation's beef cattle herd had dropped to 90.8 million, 2 percent less than the previous year and the lowest inventory since 1952, when the herd totaled 88.1 million.
Most of that decline happened in Texas, Oklahoma and other major cattle-producing states where prolonged drought has forced ranchers to cull their herds.
Texas' herd has shrunk by 11 percent from January 2011, although it remains the largest among the states, with 11.9 million cattle and calves.
Baker County's numbers are modest by comparison – about 123,700 — but that ranks fourth among Oregon's 36 counties.
(Malheur County has the largest herd, at 271,000, followed by Klamath (197,800) and Harney (132,000).)
Baker County's cattle herd has remained relatively even the past few years.
Moore doesn't expect that will change.
Although high prices certainly make it enticing for ranchers to try to increase their herds, doing so isn't a simple matter.
Perhaps the biggest limiting factor in Baker County is that there's no surplus of grazing land, either public or private, Moore said.
On the public side, the trend over the past couple decades has been to reduce the number of livestock on grazing allotments, not to increase capacity, he said.
The BLM, for instance, has cut by about 15 percent the number of cattle allowed to graze on the Baker Resource Area since the Area's management plan was adopted in 1989.
Foster said that "on paper, at least," he could add another 100 head to his herd.
But he said he's leery of doing so.
For one thing, the price of mother cows is "sky high" now, Foster said.
For another, one year with paltry forage could turn the investment into a larger herd into a financial loss.
Moore and Martin both also point out that the sales figures from OSU, although they look pretty on paper, are gross amounts.
Those don't take into account rising costs for fuel, fertilizer and other things required to run a ranch.
That said, both ranchers acknowledge that their complaints amount to little more than nitpicking.
"The fact is that it's an amazing time to be in the cattle business," Martin said.