Jon AngellFrom the Publisher ... Jon Angell

Up front this month, we are bringing you an article that goes behind the thinking of a major corporate cattle feeder, Cactus Feeders. Cactus is one of several major corporations which all have differing stratagems to utilize their location, resources, and strengths and then compensate or minimize and manage away disadvantages or weaknesses. I don’t want producers to read too much into the article since Cactus isn’t a strong participant in most of our trade territory. Other large cattle feeding corporations might approach things from a completely different perspective. I found it enlightening as to how they put their business strategy to work and some of the explanations as to why they do things is interesting. It’s well worth reading, I’ve read it a couple of times now.

Of course we have several news, market reports, and good regular columns among these pages but at print time my attention has been hijacked by the new virus coming our way from China. I’m looking about what it is, where it came from, how it travels and what impacts we might expect. Questions still outpace answers, but let me share in a condensed version some of what I have found.

Coronavirus Spreads
Coronavirus is a legit worry. At this writing and publication date, the assumptions, speculations, and unknowns of this virus far outweigh what we do know. What we do know is that this is one bad bug with some characteristics that will make it very difficult to contain.

Specifically two features worry me and other worries are likely to come. First, the incubation period is fairly long at up to around 14 days and, secondly, an infected person can be contagious long before and after symptoms are present. This makes containment through quarantine harder to successfully implement. Quarantines are the best tools we have to combat new and little known infectious virus and disease, but the two worries I mentioned will make that extremely difficult. When you pair these things with the volume, incredible distances, speed, and frequency of modern travel, the “seeding” of new outbreak points is almost assured.

The Chinese communist regime says that the virus originated in a live exotic animal and fish market in Wuhan, the seventh largest city in China with a population of about 11 million. At this writing, it is reported that authorities have quarantined the whole city. Wuhan is sometime referred to as China’s Chicago, a central transportation, manufacturing, business and financial hub among many lakes and rivers; only it’s four times bigger than Chicago.

That it started in China is problematic on many levels. The Chinese regime is undoubtedly underreporting the true scale of the coronavirus outbreak. China is a communist regime, although it has a central command structure that can at will quarantine and unilaterally act, they also have a tendency to be unreasonably self-interested, less than cooperative, less than truthful. What the communist say is far less reliable than watching what they do, and what they are doing tells me that the Chinese authorities are terrified of this virus. This thing looks to have already gotten ahead and away from them early on. The Chinese government is building hospitals at record speed, suspending travel, and shuttering up large cities quickly now.

Another problem is the viruses’ reproduction rate. Guangdong’s Center for Disease Control and Prevention on Jan. 25 put the reproduction number at 2.9, saying the disease “may have a higher pandemic risk than SARS”— a large outbreak originating from southern China from 2002 to 2003, which officially killed about 800 worldwide. Although that is a preliminary reproduction number that could change, which means that each infected victim it is believed infects almost another 3 people.

China is the second largest world economy. Because of its expansion aspirations, resource needs and export trading desires, China has tentacles to every corner of the globe. China is now closing down to the world, but the horse (maybe many horses so to speak) may have long escaped the barn.

Virus Unknowns
Because this Coronavirus is new and still in the early days of the outbreak, and then considering its unique characteristics, the death to recovery rate is far too early to figure. The origin theory of exotic animal market was put forth by the communist Chinese regime. The conspiracy theory is that it is a weapon-ized virus that was genetically modified at a chemical biological warfare complex located near Wuhan that got away from them. It’s too early to know and I am not saying it’s true or false, but it is an interesting theory that would explain the unique makeup and characteristics of this virus, as well as the panic governmental reactions. The government might know more than they can publicly state, and from the outside looking in they look truly terrified.

There is no doubt there is potential of far reaching and surprising economic disruptions as this virus progresses. Saudi oil ministers are discussing significant cuts to oil production to avoid a supply glut and its effect on prices. Supply chains for all kind of products, even consumables staples such as blue jeans, will likely be seen. How it will affect our anticipated sell of agriculture products to China is now in question.

“I would say there is a very high pandemic risk,” said Dr. Eric Feigl-Ding, an epidemiologist at Harvard University, referring to risk that the outbreak will morph into a worldwide epidemic. He said in The Wall Street Journal article the risk was exacerbated as a result of asymptomatic patients spreading the virus unknowingly. What a mess.

Pandemic risk was a risk I as a cattleman didn’t see coming, which would make it eligible for what is termed a “Black Swan” event. The disruption potential looks huge to me and will be unfolding over the next days, weeks and months and who knows maybe years.

We can’t seem to catch a break in the cattle business, but I’m far happier dealing with our problems than to deal with the many problems China is constantly working with. We’ll keep an eye on this, and other interesting news found in these pages.

Thanks for your continued support of our paper, thanks for reading.