Cattle Cycle "all over again"

[Stocker Steve]

I went back and reviewed my cattle cycle notes. Better late than never... There were a lot of vague comments about "the (liquidation) signal". They seemed to be focused on calf price. One expert even went so far as to say we should cull cows who were not profitable! :shock: Once we get "the signal" the experts then suggested:

- cull the **** out of those cheap bred cows you collected during the herd expansion
- buy back good heifers (sounds like that market is very variable, and I need to ship mine to the Rainy River district)
- use some of the cash we stockpiled during the goods years to carry the operation
- invest the rest of the cash in stockers :cowboy: I kind of like that part.

I don't think we have hit the bottom on calf price yet. The grain guys will get a price bounce eventually and then it will get ugly.

 

[angus9259]

- use some of the cash we stockpiled during the goods years to carry the operation
- invest the rest of the cash in stockers :cowboy: I kind of like that part.

I don't think we have hit the bottom on calf price yet. The grain guys will get a price bounce eventually and then it will get ugly.

a. who was stockpiling cash?? I didn't know we were supposed to do that. must have missed the memo.
b. I don't think you should use the words "invest" and "cattle" in the same sentence
c. It will be getting ugly
d. glad this isn't my livelihood.

 

[Nesikep]

I recommend y'all just sell out completely and use the money to buy a beach house and (maybe 'or' for some) a golf cart
It will help prices for me in the long run.

Angus, I like (b), glad I did (a), I'm good for at least a couple years

 

[Aaron]

Well, the sale is over today. All I can say is people are nuts. Big drop in the yearlings and calves went crazy. Calves sold higher than yearlings. Glad I sold majority of yearlings a month ago because I lost $200 a piece on the two I sold today, from what they were worth then. I was planning to keep my calves this winter, but if backgrounders are this crazy a month from now, my calves are headed to town! #thereisnomargininthesecattle

Heifer calves in high demand, all the backgrounders want to be cowmen! Gonna show us how she's done!
#cantbelievethecrapguysbuytomakeintocows #gonnabeaglutofcalvesthenexttwoyears

 

[Stocker Steve]

Sounds like you should have gone home and loaded them up.

Lots of heifer retention here too but not crazy pricing. Justification for retention is partially cheap feed, partially heifer calves have been bringing U$S 650, partially denial about the existence of a cattle cycle, partially FSA loans...

 

[Aaron]

Sounds like you should have gone home and loaded them up.

Lots of heifer retention here too but not crazy pricing. Justification for retention is partially cheap feed, partially heifer calves have been bringing U$S 650, partially denial about the existence of a cattle cycle, partially FSA loans...

Not quite big enough yet. 500 lbs was the magic number, below that and price dropped like a rock. Could be $200 difference between a 450 lb calf and a 500 lb calf.

 

[Stocker Steve]

Peak cattle inventory usually lags peak cattle price by several years.
Many of these retained heifers could go to kill if the market keeps dropping, but there seems like a bred heifer bubble building right now.
When is the last time your saw this?

 

[angus9259]

Peak cattle inventory usually lags peak cattle price by several years.
Many of these retained heifers could go to kill if the market keeps dropping, but there seems like a bred heifer bubble building right now.
When is the last time your saw this?

Good question. I have no answer. All I know is I sold most of my heifers every year that feeder prices were high and my cows are now old and departing me one by one. The next two years I will be retaining my heifers for two reason. 1. Cows are old 2. prices are too low to sell them anyway. It's actually not a bad time to retain them if you need to.

However, if someone offers me "bubble price" for them as breds, the will probably leave too. I'm trying to turn over a new leaf. By low sell high. Normally I do it the opposite of that.

 

[Dave]

Now is a good time to keep heifers if you need replacements. Even if you just want to make the herd younger. However, the people I hear saying that at these prices they will just keep them and breed them planning on them being worth more next year as bred heifers...... I have news for them. The value of those heifers now plus the cost to feed and breed them is most likely more then they are going to be worth to sell as bred heifers. I know an old cow man who says that the first loss is generally to smallest loss.

 

[Stocker Steve]

Our first large fall sale today. Typical 5 wt. prices:
bulls - teens
most - $1.20s
top steers - $1.34
600-700# 4m bred BA - $750
800-900# 4m bred BA - $1050 to 1200

Couple guys with loan payments to make had long faces. One young guy was all pumped up and said he was going to do a big herd expansion...

 

[Stocker Steve]

Now is a good time to keep heifers if you need replacements. Even if you just want to make the herd younger. However, the people I hear saying that at these prices they will just keep them and breed them planning on them being worth more next year as bred heifers...... I have news for them. The value of those heifers now plus the cost to feed and breed them is most likely more then they are going to be worth to sell as bred heifers. I know an old cow man who says that the first loss is generally to smallest loss.

I am afraid you are right about next years bred prices being below cost - - so how does that make this a "good time to keep heifers" ?

 

[Supa Dexta]

600-700# 4m bred BA - $750

4 months bred and not even 700 lbs?? :lol2:

 

[Stocker Steve]

600-700# 4m bred BA - $750

4 months bred and not even 700 lbs?? :lol2:

Auctioneer said they were out of a top efficiency EPD bull and bred to calving ease bulls. Buyers were not impressed. The smallest one weighed 610# and went for U$S 470. Thought about buying her and using lute but I don't think it is 100% after that amount of time.

 

[Dave]

Now is a good time to keep heifers if you need replacements. Even if you just want to make the herd younger. However, the people I hear saying that at these prices they will just keep them and breed them planning on them being worth more next year as bred heifers...... I have news for them. The value of those heifers now plus the cost to feed and breed them is most likely more then they are going to be worth to sell as bred heifers. I know an old cow man who says that the first loss is generally to smallest loss.

I am afraid you are right about next years bred prices being below cost - - so how does that make this a "good time to keep heifers" ?

It is a good time only if you are keeping your own heifers. If and it is a big if, you have a desire to keep your own heifers now is a good time. Financially it would work better to sell the cull cow and that heifer calf and buy a pretty good bred heifer with the money.

 

[Stocker Steve]

It is a good time only if you are keeping your own heifers. If and it is a big if, you have a desire to keep your own heifers now is a good time. Financially it would work better to sell the cull cow and that heifer calf and buy a pretty good bred heifer with the money.

Thanks for the explanation.
I do keep some of my heifer calves. They can cost more but they also have more longevity. I select at weaning, cull again before breeding, and cull again after the first calf.

 

[True Grit Farms]

If you have the capacity and feed it makes no sense to sell heifers in this market. There's a lot of folks who bought in at the wrong time, and they'll be selling good stock just to pay some of their note. Things will work out in a couple of years. Hopefully more folks will sell out and buy goats, I hear that's where the money's at.

 

[Stocker Steve]

If you have the capacity and feed it makes no sense to sell heifers in this market. There's a lot of folks who bought in at the wrong time, and they'll be selling good stock just to pay some of their note.

With heifer calves at U$S 650, and 4 month breds at $1050, which do you think is a better buy?

 

[RanchMan90]

The old penny wise pound foolish equation. The input costs will be equal in time, but the cash flow of the breds will be much better.

 

[True Grit Farms]

If you have the capacity and feed it makes no sense to sell heifers in this market. There's a lot of folks who bought in at the wrong time, and they'll be selling good stock just to pay some of their note.

With heifer calves at U$S 650, and 4 month breds at $1050, which do you think is a better buy?

I'm not qualified to answer that question, but here it goes. I feel like the cow would be a better buy easily. For starters she's bred and shouldn't have any troubles. And you'll have a calf to sell within a year with the cow. It'll be 18 months before the heifer's calf can be sold. That's assuming the heifer breeds and has no problems and accepts the calf.

 

[TennesseeTuxedo]

If you have the capacity and feed it makes no sense to sell heifers in this market. There's a lot of folks who bought in at the wrong time, and they'll be selling good stock just to pay some of their note.

With heifer calves at U$S 650, and 4 month breds at $1050, which do you think is a better buy?

I'm not qualified to answer that question, but here it goes. I feel like the cow would be a better buy easily. For starters she's bred and shouldn't have any troubles. And you'll have a calf to sell within a year with the cow. It'll be 18 months before the heifer's calf can be sold. That's assuming the heifer breeds and has no problems and accepts the calf.

What's wrong with goats?