Are Feedlots Making a Killing?

[BFW]

Farmers Son I think your numbers are reasonably close for your area. The only part of the equation I question is the price of the 6 weight steer. Buying the good ones today would cost you upwards of $105/cwt in the ring anywhere from Ponoka south. Add freight and commission and you are an easy $107-$109/cwt delivered. The 95 for fats delivered to Brooks or High River is pretty close to being achievable depending on the effects of MCOOL as we get into larger numbers here. There in lies the problem as Grassfarmer has pointed out. The risk in finishing cattle has risen substantially since the implementation of MCOOL and the only protection a buyer has is to buy the feeder animals as cheap as possible. I know this only speeds up the slaughter of the cow herd but there is no other solution in the short run. CAIS offers very little protection in this environment and is virtually useless if you have diversified operation with the grain side kicking out good returns. The AFRP payments where helpful and I think without them the feeder market would not be what it is today. Also the lack of a US bid on calves is also contributing to the wide feeder basis. The market is what it is and the risk of retaining ownership for producers is as great as it has ever been given the number of potential landmines out there.