80 cent calves?

[kpb]

kpb, it sad that you would think your comments are wasted on producers that do not have vast amounts of cattle.

The smaller operators should feel as welcome on this site as anyone, and certainly can learn from the experiences of others like yourself.


I know a lot of people who started in the cattle business with a dozen cows, and built their herds up from there. Maybe they aren't huge landowners, and maybe they don't fit the image of a 'rancher' but then what is a rancher ????????????

[kpb]

well emerald, if you think that someone who is running 20 cows as a hobby and has other income to support that hobby is in the same position as someone with 300 cows trying to make a living off that herd, than I guess you and I are going to have to agree to disagree.

This board is open to everyone by its very nature--that goes without saying. But that doesn't mean that the guy running 20 cows as a tax write-off has as much worthwhile or meaningful to contribute about the cattle industry as the fellow trying to keep the family farm together.

Tell me, who do you think has more ability to say something worth listening to about hockey---an NHL player or your local beer league skater? Who is likely to be more committed and more knowledgeable?

kpb

[farmers_son]

I have 183 head in my herd. And raising cattle and crops is my only income. Other than government handouts and surface lease revenue that is. Not that is should matter, either my words are valid or they are not.

I am trying to figure out if you think I am the NHL hockey player or the play in the beer leagues. LOL

I have spoken personally with Harlan Hughes and I understand where he is coming from. And I have spoken many times with Charley Gracie who I have the utmost respect for. If you recall Charlie pushed the concept of cattle cycles in Canada about the time there was a debate on marketing boards for beef. I have studied what both these people have to say. Their words may have bene valid 30-40 years ago but it is a different cattle industry today.

[kpb]

farmers son, for reference you qualify as Iginla with your cow herd. And I do think that your involvement in the industry gives more weighting to your words than someone who sees cattle as a hobby. I want to make it clear to everyone, before I get jumped on, that I don't believe that everyone needs to have 300 or any specific number of cows but I do think there is a difference between a hobby and a living and I, for one, would rather listen to someone in the life.

I have also talked to Hughes but not Gracie. I found Hughes to be very credible and he gave me some good advice about where we were in the cycle (several years ago).

I understand that you believe that the packing situation in this country has distorted the supply-demand curve but do you believe the same applies in the U.S.? farmers_son, I have trouble believing that you truly do not think there is such a thing as a cycle related to the number of weaned calves viz a viz feeder prices. Do you think that this cycle exists in the U.S. but not here or does not exist at all? Do you believe that Hughes and Gracie are deluded or just out of touch with today's reality?

I also think that historically producers do not, in fact, reduce their herds to a significant extent during a drought. They should, but in fact, most producers try to weather the drought by buying in feed. Also, most droughts are regional in nature and do not have a lasting impact on overall cattle numbers. Finally, your argument that if there was a cycle than someone would have taken advantage of it by now to own the whole industry is incorrect, I think. In fact, most producers are either unaware or do not believe in a cattle cycle. Most stock market investors also do not believe in the cyclical nature of their investments. And the same applies to copper producers, iron producers and steel producers. Most people like to do whatever everyone else is doing. It's not easy to go against the crowd and do the opposite which is why most investors pile into stocks (and cattle) at the very top of the market and cannot bring themselves to invest at the bottom (when they should). Emotionally it is very difficult. But the most money is made by a contrarian approach to investing.

I think cattle prices move in a cyclical fashion. I think there are disasters that have short-term impacts but the overall trend is predictable. I think history shows this to be so. I have used this to make money in the past. And I think I will be buying good heifers in a couple of years for about $420 that will be the basis of my next herd. I might be wrong--I have been wrong lots of times--but at least I think I have a plan and an idea of where I'm going.

kpb

[kpb]

kpb, by the same token should my neighbour that runs 1200 cows, and backgrounds 2000, and has been in the cattle business for 25 years, be a better and wiser cattleman than the another neighbour that runs 300 cows with 40 years experience in the cattle business.
In my view its all relative. Many folks that I know in the industry started with a small herd, worked off the farm to pay for the land, machinery and buildings, then built up their herds to the point where they could sustain their family without off farm income.

Although I don't have a large cattle herd I TOO have heard and spoken to Harlan Hughes, Bob Church and many others. I don't think that our ability to learn and understand the industry is tied to the number of cattle we own.

[kpb]

grassfarmer, I have read the article you suggested--it is very interesting. Besides reiterating and giving historical and contemporary background to the cattle cycle, it does provide proof of the linkage between the U.S. cattle cycle and Australian prices. In fact prices in both countries track closely as seen in the graph in the article.

If you are wondering why Australia does not have its own cycle, I can only assume that being a huge exporter (the world's largest) but not having the largest herd in the world (the U.S.), they are subject to the same pricing pressures from the Americans that we are?? In other words the big dog (the U.S.) determines the prices by virtue of its being the so-called swing producer.

It is clear from the article--and particularly in the conclusion--that, while there are other factors that also are at work in Australia, the prevailing stage of the U.S. cattle cycle is the so-called "critical factor" in determining Australian prices.

kpb

[kpb]

emerald, nope, both sound like good people to listen to and a heck of a lot better than someone working in Calgary who has 20 cows in order to get a tax break.

kpb

[kpb]

or maybe working in Calgary to pay for the farm !!!!!

[cswilson]

Ag Lenders do more to fuel the cattle cycle than anything in 96 they shut off alot of guys operating money-fall futures were in the 80's and you could buy decent grass calves for 60-70 cents. We made out like bandits on calves we bought that June-conversely when they're high they'll stop you on the street to give you money. Emotion rules the cattle business far more than it really should.

[cswilson]

Ag Lenders do more to fuel the cattle cycle than anything in 96 they shut off alot of guys operating money-fall futures were in the 80's and you could buy decent grass calves for 60-70 cents. We made out like bandits on calves we bought that June-conversely when they're high they'll stop you on the street to give you money. Emotion rules the cattle business far more than it really should.

[cowman]

I agree there is a cattle cycle, but it can be delayed or advanced by the things FS and cswilson mentioned? Right now in Canada our cattle cycle is all messed up, but apparently it is still functioning in the US and in reality we are tied to them very closely? I'm not sure what the drought in Texas might do to the American cattle cycle?
We were forced into expansion by BSE when all the signals should have been to go into retraction? If cow prices had been normal we would have shrunk the cowherd...not expanded it? Now it appears(Anne Dunford) that we are shrinking the cow herd? Our cattle cycle is all screwed up!
I do wonder how anyone is going to make money on those $1300 cows though, especially when they are probably financed?

[blackjack]

... well i beleive alot in what csw says about the year ending in 6... remember back in the seventies as a kid...my father had just bought some land in an area that had been predominately grain...well cattle prices were pretty good in 74 and 75...so some of these grain guys decided to go out and buy some high priced breeding stock...well along came 76 and the market crashed ...two years later i don't think the grain guys had any cattle left...lol