Beef Market Update - Where Do We Go From Here?

[shaney]

Barley is bumping off of $200, corn is $7.00 per bushel and dressed cattle prices are just under $200. What is going on here? With inputs and cattle prices both in bull runs it is easy to get caught up in the assumption that this will last forever. As the old saying goes, what goes up must come down but the question is whether this market has some more run in it before the summer blues.

In this weeks episode of the Beef Market Update with Anne Dunford, we discuss the following:
<ul>
<li>Can we push through $200 in the dressed market?</li>
<li>Who is going to buy this expensive beef once it hits the grocery store?</li>
<li>Anne heard the CEO of Cargill speak this week in Calgary so she enlightens us on Cargill's thoughts on this market</li>
<li>A early peak into what the summer market may bring with the significant highs reached this spring</li>
</ul>
SEE OTHER EPISODES OF THE [URL="http://realagriculture.com/category/beef-market-update/"]BEEF MARKET UPDATE[/URL]

If you cannot see the embedded video below <a href="http://www.youtube.com/watch?v=iQyaIETmuSg&feature=channel_video_ title">click here</a>.

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[per]

Good interview this week. I also was listening to Greg Page. On top of what Anne had to say the most interesting comment for me was when asked what the biggest impediment is to getting the world fed, he did not hesitate in his answer... Property Rights. Of course he was referring to less stable Countries where your investment is taken away by regulation or edict of a rogue leader (Statutory Consent). There certainly are parallels here. Regulation can certainly become our nemesis.

[smcgrath76]

Welcome to AB, per. I believe there are
a couple of bills right now that are
nearly 3rd worldly.
There will be a big push to get Altalink
done and signed before they are
"reworded".
I think now is a great time to be very
cautious about spending, either trying
to build a bit of a warchest on farm, or
investing in things to drive costs down.
Excitement in the industry excites me,
euphoria scares the @#$% out of me.

[per]

Sm, you are the first one ever to welcome me to Alberta. Thanks although I have always been here. Your perception of where we are and where we are going is right on in my opinion. I hope you are wrong.

[shaney]

So I am assuming that neither of you will be holding back heifers this year.

[smcgrath76]

We always retain replacements as I don't
believe we can buy as good as we raise.
We have sold all our heifer calves
(other than our keepers), have a plan in
place for the cowherd if the price hits
a target level, and are planning our
next major expansion to occur roughly 5
years from now. We have more than
doubled our cow numbers in the last 5
years, but are in all probability either
in very slow growth, static, or herd
reduction mode for the next 5 or so.

[per]

I've never been great a outguessing the market. We will also be retaining replacements as we always do. I have 2/3s of last years calf crop and grass to look after them. Someone else might need to own them soon. The cow herd will be maintained and although there is room for growth it may wait.

[greybeard]

If this is the high and we cycle down to where we were there will be a no shortage of hamburger coming out of this area as most I talk to are still leaning toward getting out.
Grain has been good and most of the ground here will produce.
For sure it won't go up forever and we will see some ups and downs but as stated in the second half or that report there are many NEW positives that nobody saw coming. Most notable to me is rising exports and falling imports in NA. That is the currency story,not the $103 against the US.
The news is full of things that would have tanked the calf market as SADIE describe on the other thread. Can't hurt this market as if it falls at all everybody rushes in to get a bargain.

[burnt]

Good points, Greybeard. The difference in returns between grains and livestock is getting too great - both in dollars and work required. The post-BSE years have left a bitter taste for the industry in general.

[smcgrath76]

One thing to remember though is that the
price drivers are definitely not
Canadian. The expansion/contraction of
the US herd will have a far bigger
impact on our prices.
The Canadian influence to state it
politely lies more in the area of
price/production controls, and the risk
lies in politics and animal health. In
a lot of ways I see the Canadian herd
contracting, but I don't see the US herd
remaining shrunken forever.