Cattle Bids Turning Up

[charliep]

Just so we understand that this is a continuation of the trend that has been in place for 10 years with the cow herd down 20 plus percent already.

In some areas (not in all), four legged critters are better ways to harvest crop (maybe even perennial that doesn't require tillage every year) than a quarter million dollar each tractor, one pass seeder and combine. They may fart but they are many ways pretty environmentally friendly and use our resource (land) pretty efficiently if a farmer manages that resource well.

Way off topic. Same pain for the livestock side as they adapt to the new feed world (price and quantity). Longer term an optimist given the reduction in supplies will eventually hit home and grain will increase ($8/bu will be a signal to grow more if mother nature cooperates). Hogs and poultry can biologically respond faster to price improvement. How will the consumer respond given their realities and the choices at the meat counter?

[charliep]

oops. Grain prices will decrease as production increases next in response to higher prices.

[charliep]

A math guy so like to do the numbers for a Montana (numbers are different in Alberta). Will use the bottom end of your estimates. $200/ton is 10 cents/lb. 30 pounds/day equals a cost of $3/day or over 200 days $600 to winter a cow. A 600 pound calf means the first $1 a pound paid 14 months from now goes to wintering the cow. Way too simple (will be criticized) but simple math for me.

[GreenValley]

ASRG, make sense to buy hay at expensive
bill cuz buy back cows may not next year
but 3 or 4 years away so it is cheaper
if want run business or sell at all and
not bother to buy cows in 3 to 4 years
away and enjoy the vacation. Also 10
years away somewhat arrive will be baby
boomer year, what cattle will be look
like. I am one of baby boomer.

[GreenValley]

Charlie, in Montana they has grass left
over to feed in winter so I believe 200
days is too much perhaps 100 days more
or less. Where most time no snow there
so can graze grass what left in winter.
In drought year like this year is other
question, maybe increase pasture acre vs
cow ratio so has left over pasture for
winter.

[errolanderson]

good discussion on value of hay . . . .

changing gears into the feeder cattle
futures, the Nov contract breaking
higher now. The chart technicals suggest
move toward $150/cwt, maybe higher.
We'll know soon on extent of this
rebound.

Corn technicals to me suggest an 80
cent/bu pullback top to bottom is now
in-progress. Dec corn to $7.70 -
$7.75/bu area? Major support may be as
low as $6.80/bu, but this is may not be
seen for a few months.

Interesting shift in market dynamics in
just one week.

[ASRG]

Green Valley: I too am a baby boomer. When I quit I'm never going back into cows?
The fact is cows are a lot of work?
It's just peachy for us baby boomers to run cows by cutting back on numbers....but does it make economic sense for young guys who have to pay the bills and service debt?
Sooner or later us old farts got to retire?
I don't think there are enough young guys who are dumb enough to raise cows....or can afford to?
Charlie: As someone who has raised cattle all my life, I find as I get older I prefer chicken or fish to beef....especially when that eating experience sometimes isn't all that good? With chicken I get a predictable product.....a steak can be exceptional......or it can be like eating an old boot! I never eat beef in a restaurant.

[grassfarmer]

Discussed this with quite a few people from all over
the US last week. A few comments came up that
indicate different potential outcomes. Cost of gain
with $8 corn is said to be around $1.50/lb. Areas of
shortage include the Five Rivers feedlot in Colorado
where they traditionally buy standing corn for silage
from local farmers - having to bid $80/ton standing
to get it.
The majority of the crop already harvested in the
north had the straw chopped as usual so not looking
to save every last bale of feed. Lots of corn crops
being worked into the ground once the insurance
cheque comes in so not a real effort to help out the
cattlemen.
Lightweight heifer calves of Angus type are being bid
to record highs on the northern plains - higher than
same weight steers - for export to Russia. Just
commercial heifers - not purebreds. One buyer
bought 3000 head at a recent sale. This will short the
calf market a little but I think longer term will keep a
lid on US cow expansion.

[charliep]

With Errol's comment about strengthening feed cattle prices and a potenial short term pull back in corn prices, just curious what Albertans will do this fall. Sell feeder calves off the cow? Be tempted to use some of the forage supplies to background into the winter? Realize everyones situation is different. Will the US drought force US calves off cows earlier and into feedlots? Yearlings on grass?

[T.N.T.]

ASRG you sure put a very negative impact on anyone that wants to raise or already raises cattle!! Who are dumb in enough to raise cattle?I'm sure all your neighbours kids if they have the thought of raising cattle,after they are done talking to you,they must leave thinking they must be dumb to want to raise cattle and they give up on the idea because they must think they must be stupid to even want to do it.I'm exactly opposite of you,about 7 years one of the neighbours boys wanted to get into cattle business but the bank wouldn't borrow him money for cattle because of bse.So i leased him 50 cows to get him started,and to build his herd with these cows.Why?The cattle market has always in the long run made our farm money,even when others are complaining about there is no money in cattle,and because he was always a good kid and not afraid of work.Me or the boys gave him a hand the first couple of calving seasons when he need more experience but he is always willing to learn more about the cattle business.Today that young man has a herd of 140 cows and expanding and is doing good,and he will always remember the old fart that gave him his original break to get him where he is today,and that was my reward because i gave him a pretty good deal on the lease of those cows.Where is it written that sooner or later us old farts have to retire?I'm going to being turning 82 this year and still going strong,and hopefully the only way i retire will be in a wooden box!! Why did you keep cattle your entire your life if people that raise them are so dumb?Why did you keep cattle if they are so much work,or there is no money to be made in cattle??This old fart doesn't think he is that dumb!! Those cows that are so much work,sure relax's this old fart!!And those cows that are so much work,and never give a person any money in return,sure helped us to put a land base together for us to pass on to the next generation to enjoy!!!This old fart doesn't see those cows as that much work,i guess thats just because i'm not a lazy kind of person!!