What a strong market we have here in the United States! It seems like neither rain, nor snow, nor black of night, nor high priced grain and gas is going to let the market drop out of the bottom! It has been a bouncy ride for sure, but there does seem to be strength in the market, although it is at lower levels. Considering input costs, it’s almost a miracle that calves and feeders are as high as they are.
Fat cattle of course, are another thing! There doesn’t seem to be any rhyme or reason as to whether they bring $85.00 or $105.00! A steak still seems to cost as much or more as it did ten years ago, week in and week out, yet a fat steer might fluctuate as much as $100.00 in a week! How did we get ourselves into this situation?
Back in the nineties, there were weeks that as many as 400,000 fat cattle traded hands, today in might be 40,000. Contract, formula and packer owned cattle have changed the face of our fat market dramatically. Cattle used to trade every day of the week, with maybe a 50 cent change in price during the week. Nowadays, they might all trade during 15 minutes of one day with a $7.00 swing. There doesn’t seem to any fixed way to determine a price for the fats, it’s whatever the packer buyer thinks he can get away with.
Things sure have changed in the last 10 or 15 years. In 1996 we had five or six dollar corn and heifer calves were bringing in the forties! Today we have five dollar corn and heifer calves are still bringing in the nineties, with steer calves still bringing above $100.00! How can we think this is a bad market? Especially when we consider that gasoline is probably $2.00 or $3.00 a gallon higher and water is being sold by the bottle!
The wheat cattle run this year is definitely going to be a lot different too! How many remember those weeks in March when every sale barn had 5,000 to 20,000 head? The number of cattle being turned out on wheat seems to diminish every year for one reason or another. Our nation’s cow herd is several million head short of what it was a few years ago, with lots of heifers still going to the feedlots! Sheer numbers of people versus numbers of cattle will almost have to keep this market strong!
It sure looks like as long as we keep our markets open and our borders closed, we’ll have a great market for quite a while! The wheat and corn may or may not stay at these levels, but one thing is for sure, cattle will eat both of them! One niche in the economy that may be worth pursuing is that little niche of taking care of cattle on the wheat. It seems like we have more people retiring from the cattle business than getting into it. Maybe that leaves some great opportunities for someone!
OUR NEXT END OF THE MONTH COW SALE IS TUESDAY, JANUARY 29, 2008!
Over 300 black and bwf bred heifers and young cows are already consigned, along with more than a dozen registered low birth weight Angus heifer bulls! Please call ahead so that we might help you more! We really appreciate your business!
Weston Winter
