Are today's prices sustainable?

[BC]

Not complaining about the prices of calves because all in-put costs associated with raising cattle have increased, but this market has me scared that we are set up for a big crash. Today, I saw a 630 lb steer bring $1.30 that is $819.00. The yearling will need another 650 to 700 lbs before ready for harvest. With grain prices rising, feedyards are estimating the cost of gain being $1.00 per lb or more. This calf will need to bring $1.15 to $1.16 just to break even.

My concern is the American consumer will rebel at that price and look for alternative protein choices. They are not used to their food costs being more than 9% to 10% of disposable income. This will take away from going to the movies, golf, fishing, hunting, boats and casinos.

 

[dun]

Nope!

 

[kenny thomas]

Nope!

I agree, I am selling them just as soon as they get ready.

 

[Caustic Burno]

They never have been before.

 

[Kingfisher]

Not complaining about the prices of calves because all in-put costs associated with raising cattle have increased, but this market has me scared that we are set up for a big crash. Today, I saw a 630 lb steer bring $1.30 that is $819.00. The yearling will need another 650 to 700 lbs before ready for harvest. With grain prices rising, feedyards are estimating the cost of gain being $1.00 per lb or more. This calf will need to bring $1.15 to $1.16 just to break even.

My concern is the American consumer will rebel at that price and look for alternative protein choices. They are not used to their food costs being more than 9% to 10% of disposable income. This will take away from going to the movies, golf, fishing, hunting, boats and casinos.

They ( the beef buyers) told us last month that hamburger would be pretty expensive come about March.........I wish I had a bunch of calves.....

 

[Bonsman]

I do not see how the prices can stay this high unless three things happen: the price of retail beef increases a lot; exports increase; and the feedlots and packers find a way to make money given the high price of corn and slim margins. Right now, the feedlots have to bet on the come because they cannot hedge and lock in a profit on the futures.

The "only" thing I remember about my economics class in college it the supply/demand curve. The supply of beef cows is at numbers not seen in decades. So the supply is low. We need the demand which depends on the economy picking back up. Cattle prices in Oklahoma were up 4-10 dollars a hunderd weight last week. We are selling the rest of our steers and our non-replacement heifers that are running on wheat. You cannot go wrong selling at historical highs. But that does not mean that cattle will not go higher this week.

Short answer, no I do not think they are not sustainable in the near term. At the same time I would not place any "put" bets on the market.

 

[Caustic Burno]

I went to the sale yesterday unbelivable prices on cutter cows. The prices on calves was the same, didn't matter if it was quality or not. It just had to be able to moo. That being said the barn was at maybe 1/3 capacity, everyone over here has dumped as well as I. Imports are going to have to go up to fill the demand. Another issue is people selling out, we were talking at our local gathering spot this week and the fellow that runs the feed store is worried. He said he figures one third of his customers have sold out due to the prices and the average age. I had some data I saved somewhere and the average age for Beef producers was 55 in 2002.

http://www.agday.org/media/factsheet.php

 

[dun]

I went to the sale yesterday unbelivable prices on cutter cows. The prices on calves was the same, didn't matter if it was quality or not.

Wa5tched a couple of minutes of a DVAuction at the local sale barn. Some pretty sorry 785 lb claves went for 187 cwt. I wish I hadn;t sold everything a couple of months ago.

 

[tncattle]

I went to the sale yesterday unbelivable prices on cutter cows. The prices on calves was the same, didn't matter if it was quality or not. It just had to be able to moo. That being said the barn was at maybe 1/3 capacity, everyone over here has dumped as well as I. Imports are going to have to go up to fill the demand. Another issue is people selling out, we were talking at our local gathering spot this week and the fellow that runs the feed store is worried. He said he figures one third of his customers have sold out due to the prices and the average age. I had some data I saved somewhere and the average age for Beef producers was 55 in 2002.

http://www.agday.org/media/factsheet.php

I'm almost 43 and just really getting into cattle farming (last 4-5 years). I don't know of anyone in my area (sure there are a few) my age or younger getting into it. I do know of many older cattlemen and just talked with one the other day who sold out. Just seems like in the next 20 years the number of cattlemen will likely go down. I'd like to know the % of cattle actually sent to feedlots from producers with herds of 50 or less. I think it's probably pretty high and with those people getting out everyday seems like supply will be lower for quite awhile, but what do I know :???:

 

[bannedagain]

I went to the sale yesterday unbelivable prices on cutter cows. The prices on calves was the same, didn't matter if it was quality or not.

Wa5tched a couple of minutes of a DVAuction at the local sale barn. Some pretty sorry 785 lb claves went for 187 cwt. I wish I hadn;t sold everything a couple of months ago.

$1467.95 yeah right not a chance.

 

[Caustic Burno]

I went to the sale yesterday unbelivable prices on cutter cows. The prices on calves was the same, didn't matter if it was quality or not. It just had to be able to moo. That being said the barn was at maybe 1/3 capacity, everyone over here has dumped as well as I. Imports are going to have to go up to fill the demand. Another issue is people selling out, we were talking at our local gathering spot this week and the fellow that runs the feed store is worried. He said he figures one third of his customers have sold out due to the prices and the average age. I had some data I saved somewhere and the average age for Beef producers was 55 in 2002.

http://www.agday.org/media/factsheet.php

I'm almost 43 and just really getting into cattle farming (last 4-5 years). I don't know of anyone in my area (sure there are a few) my age or younger getting into it. I do know of many older cattlemen and just talked with one the other day who sold out. Just seems like in the next 20 years the number of cattlemen will likely go down. I'd like to know the % of cattle actually sent to feedlots from producers with herds of 50 or less. I think it's probably pretty high and with those people getting out everyday seems like supply will be lower for quite awhile, but what do I know :???:

A few years ago TAMU put out some stats, I don't remember the exact number. I remember that it was in the high 90% range that the average cattleman in Texas ran less than 35 head. Texas had the largest number of cattle, thats a lot of cattlemen going out of business. I have 12 momma cows left , I have been in a tug of war in my mind over building back up or staying here for now. Now you have to realize this tug of war is happening in a vacuum and I am still waiting for the remaining two active cells to get together and spit out a verdict.

 

[bannedagain]

I'm almost 43 and just really getting into cattle farming (last 4-5 years). I don't know of anyone in my area (sure there are a few) my age or younger getting into it. I do know of many older cattlemen and just talked with one the other day who sold out. Just seems like in the next 20 years the number of cattlemen will likely go down. I'd like to know the % of cattle actually sent to feedlots from producers with herds of 50 or less. I think it's probably pretty high and with those people getting out everyday seems like supply will be lower for quite awhile, but what do I know :???:

The beef packer will do the same as the hog packers, invest money in quality carcass research, and increase carcass weights just like hogs.

 

[upfrombottom]

BC wrote:
Not complaining about the prices of calves because all in-put costs associated with raising cattle have increased, but this market has me scared that we are set up for a big crash. Today, I saw a 630 lb steer bring $1.30 that is $819.00. The yearling will need another 650 to 700 lbs before ready for harvest. With grain prices rising, feedyards are estimating the cost of gain being $1.00 per lb or more. This calf will need to bring $1.15 to $1.16 just to break even.

My concern is the American consumer will rebel at that price and look for alternative protein choices. They are not used to their food costs being more than 9% to 10% of disposable income. This will take away from going to the movies, golf, fishing, hunting, boats and casinos.

They ( the beef buyers) told us last month that hamburger would be pretty expensive come about March.........I wish I had a

Wholsale prices for ground beef were averaging $1.74 lb last week with retail at around $2.61. That's about 40% higher than this time last year.

 

[novaman]

Wholsale prices for ground beef were averaging $1.74 lb last week with retail at around $2.61. That's about 40% higher than this time last year.

Dang you have some cheap beef there. Was at the grocery store yesterday and ground beef was $3.95.

 

[agmantoo]

tncattle

I do not have a link to the article but I did read recently that more than 50% of the animals sent to feedlots came from producers with less than 50 cows. The article went on to state that a huge portion of these producers were hobby farmers with outside incomes and that this group by operating at a loss was holding the current market, though high, at less than it would be because they were indirectly subsidizing the feedlots and beef processors.
s

 

[MO_cows]

I think unless the economy sinks, the better prices should last awhile. According to the Livestock Market Digest, the 2011 national calf crop is gonna be the lowest since 1957. Bigger carcasses and better genetics than in 1957 isn't gonna make up nearly all the difference for population growth. With higher feed prices, chicken and pork, with their higher input, more labor intensive production methods, are not gonna be all that attractively priced as alternatives to beef. If the higher prices entice people to keep more heifers and build their herds, that just takes more protein out of the pipeline in the short term. And with the dollar not so strong, imported beef is not as cheap either. I wouldn't bet the farm on it, but I just don't see anything changing for awhile to drop prices.

 

[bigbull338]

yes the cattle market will stay high for a few reasons.1 alot of cattlemen are selling out an not going back in.an alot of dairymen are selling out an staying out.thus theres no more berger coming from their cull cows or bulls.2 the national cow herd is low an dropping more each day.an its no longer growing.3 the feedlots have gone as far as they can running empty.they have to fill their pens or go out of business.4 theres no other cheap meats other than chicken.pork is sky high.berger is sky high.but you still have to buy some meats.

 

[backhoeboogie]

Everyone is dumping. The last time this happened it was because of drought. When it came time to buy back, anything with ear was sky high. If you wanted the popular breed they were a dime a dozen. We still have not recovered from the drought sell off in my opinion. Otherwise I would be culling to the bone with cows at these prices.

 

[bannedagain]

I do not have the exact numbers in front of me but us beef production per cow has increased 100 percent since 1957 population in the us has not increased 100 percent since 1957 I'm unsure of other countries pop growth compared to beef production growth per cow but I assume they are keeping pace with the us if not exceeding it

 

[dun]

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