BRIEFLY outlined herewith is a resumé of what are accepted as the chief
causes contributing to the sharp decline in livestock prices during
1919.
The discontinuance of Government orders for beef was the principal
thing which affected cattle prices in the late spring. From being a
purchaser the Government became a seller in the domestic market. Added
to this, there has been unusual labor unrest, large supplies, agitation
against the high cost of living, low foreign exchange rates, and the
English boycott against high prices.
The falling off in hog prices was far more serious than in the case of
beef, because normal demand for hogs is based on the consideration of
large exports, while the market for beef is primarily and principally
domestic.
The great demand for American pork products which was confidently
expected from European countries did not materialize, because of the
extraordinary and unforeseen development of exchange conditions which
made purchases on the American market practically impossible.
The earlier part of 1919 was marked by an unprecedented export of pork
products, reaching in the month of June the high point of over 400
million pounds. From this point the drop was sharp and continuous,
month by month, the figures for October showing total exports of less
than 120 million pounds—a falling off of 70% in four months. These
later exports were on orders booked earlier in the year, and not on new
business.
Added to these principal factors, and aggravating them, were attempted
boycotts of meat and proposed radical legislation for the regulation
and restriction of the packing industry, and the resulting condition
of uncertainty up to the very closing weeks of 1919, when the
understanding between the packers and the U. S. Department of Justice
was made public.
The big question is, What of the year 1920? While nothing positive can
be predicted, better conditions is a practical certainty. The domestic
consumption of beef is increasing to a gratifying degree; the arranging
of international credits and the opening of foreign markets is a matter
of comparatively short time. European need for pork products will be
urgent and excessive for a considerable time, and this will not only
take care of our surplus hogs, but will react favorably upon the market
for cattle and sheep.