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7 Figure 1 Total U.S. cattle and calves, real net returns per cow, and per capita beef and veal consumption, Million head/pounds per capita Real net cash returns ($ per cow) Per capita beef & veal consumption (pounds per capita) Real dollars ( =100) Total cattle and calves (million head) Note: Costs exclude capital replacement. Source: USDA, ERS.

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11 Figure 2 Retail beef price measures, January 1984-April 1997 Cents per retail pound Index ( =100) Jan-84 Jan-85 ERS Choice retail (left scale) Jan-86 Jan-87 NCBA-5 cut average (left scale) Jan-88 Jan-89 Jan-90 ERS all fresh beef (left scale) Jan-91 Jan-92 Jan-93 BLS beef & veal CPI (right scale) Jan-94 Jan-95 Jan-96 Jan Note: CPI is Consumer Price Index, NCBA is National Cattlemens Beef Association, and BLS is Bureau of Labor Statistics. Source: USDA, ERS.

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22 Figure 3 Farm-to-wholesale, wholesale-to-retail, and total price spreads for beef (Choice, yield grade 3), January 1970-August 1997 Cents per retail pound Wholesale-to-retail spread Total farm-to-retail spread Farm-to-wholesale spread 0 Figure 4 Farm share of retail price for beef (Choice, yield grade 3), January 1970-August 1997 Percent Jan-70 Jan-72 Jan-74 Jan-76 Jan-78 Jan-80 Jan-82 Jan-84 Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Aug-97 Jan-70 Jan-72 Jan-74 Jan-76 Jan-78 Jan-80 Jan-82 Jan-84 Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Aug-97 Note: Average by month, January 1970-August Source: USDA, ERS. Note: Average by month, January 1970-August Source: USDA, ERS.

23 Figure 5 Farm-to-retail spreads, nominal and deflated, for beef (Choice, yield grade 3), January 1970-August 1997 Cents per retail pound Nominal farm-to-retail spread Deflated farm-to-retail spread Jan-70 Jan-72 Jan-74 Jan-76 Jan-78 Jan-80 Jan-82 Jan-84 Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Aug-97 Note: Average by month, January 1970-August Deflator is Consumer Price Index, United States, all urban, all items, =100. Source: USDA, ERS. Figure 6 Farm-to-wholesale, wholesale-to-retail, and total price spreads: Deflated prices for beef (Choice, yield grade 3), January 1970-August 1997 Cents per retail pound Total farm-to-retail spread Wholesale-to-retail spread 20 0 Jan-70 Jan-72 Jan-74 Jan-76 Farm-to-wholesale spread Jan-78 Jan-80 Jan-82 Jan-84 Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Aug-97 Note: Average by month, January 1970-August Deflator is Consumer Price Index, United States, all urban, all items, =100. Source: USDA, ERS.

24 Figure 7 Retail price, wholesale value, net farm value and by-product allowance: Deflated prices for beef (Choice, yield grade 3), January 1970-August 1997 Cents per retail pound Retail price Wholesale value Net farm value Byproduct allowance 0 Jan-70 Jan-72 Jan-74 Jan-76 Jan-78 Jan-80 Jan-82 Jan-84 Jan-86 Jan-88 Jan-90 Jan-92 Jan-94 Jan-96 Aug-97 Note: Average by month, January 1970-August Deflator is Consumer Price Index, United States, all urban, all items, =100. Source: USDA, ERS.

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29 Figure 8 Net farm values for beef, January 1993-December 1995 Cents per pound, retail basis Actual In sample forecast 120 Out of sample forecast 100 Jan. Mar. May July Sep. Nov. Jan. Mar. May July Sep. Nov. Jan. Mar. May July Sep. Nov Source: USDA, ERS. Figure 9 Wholesale values for beef, January 1993-December 1995 Cents per pound, retail basis In sample forecast Actual 140 Out of sample forecast 120 Jan. Mar. May July Sep. Nov. Jan. Mar. May July Sep. Nov. Jan. Mar. May July Sep. Nov Source: USDA, ERS.

30 Figure 10 Retail values for beef, January 1993-December 1995 Cents per pound, retail basis Actual In sample forecast 270 Out of sample forecast 260 Jan. Mar. May July Sep. Nov. Jan. Mar. May July Sep. Nov. Jan. Mar. May July Sep. Nov Source: USDA, ERS.

31 Figure 11 Beef production over the cattle cycle Percent Detrended actual Smoothed cyclical Months 144 Note: The months start from the beginning of the cycle. Source: USDA, ERS. Figure 12 Per capita beef disappearance over the cattle cycle Percent Detrended actual Smoothed cyclical Months 144 Note: The months start from the beginning of the cycle. Source: USDA, ERS.

32 Figure 13 Deviation from average price over the cattle cycle Percent Wholesale Retail Months Net farm value 144 Note: The months start from the beginning of the cycle. Source: USDA, ERS. Figure 14 Deviation from average over the cattle cycle Percent Wholesale to retail spread Farm to wholesale spread 0 Farm to retail spread Months 144 Note: The months start from the beginning of the cycle. Source: USDA, ERS.

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39 Figure 15 Herfindahl-Hirshman Index for the meatpacking industry, by category, HHI index 2,500 2,000 1,500 Boxed beef All livestock 1, Steer & heifer Cattle Cow & bull Hogs Source: USDA, ERS, from data provided by USDA's, Grain Inspection, Packers and Stockyards Administration.

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41 Figure 16 Beef producers' shares of wholesale and retail dollars, January 1979-December 1996 Percent Wholesale dollar Retail dollar 20 0 Jan-79 Jan-80 Jan-81 Jan-82 Jan-83 Jan-84 Jan-85 Jan-86 Jan-87 Jan-88 Jan-89 Jan-90 Jan-91 Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Source: USDA, ERS.

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