Contracting cattle questions

[ryancattle5]

How do some of you guys contract or market your fat cattle? Fed cattle for a couple years now and looking to expand in doing so I feel I need a more sicure way of knowing my return on investment

 

[bmoore87]

Think that it is a good thing to use at times from what I have heard from my neighbors. Probably best bet would be to talk to a broker in your area that specializes in ag marketing.

 

[pa farmhand]

my advice is buy and sell the same market . What i mean is if you sell fat cattle in may then buy new feeders in may. Best thing i have found to reduce risk is buy and sell year round that way if cattle are high then you sell fats high if the price drops then your feeders are cheaper. That way whichever way the market moves you benefit in some way.

 

[farmguy199]

Well how many head do you generally have on feed?

 

[pa farmhand]

Well how many head do you generally have on feed?

Are you asking me or ryancattle5 ?

 

[farmguy199]

Ryancattle5

 

[js1234]

my advice is buy and sell the same market . What i mean is if you sell fat cattle in may then buy new feeders in may. Best thing i have found to reduce risk is buy and sell year round that way if cattle are high then you sell fats high if the price drops then your feeders are cheaper. That way whichever way the market moves you benefit in some way.

For the most part that's a pretty workable strategy.
We are a big fan of Put options on Fat Cattle to protect downside risk too.

 

[Son of Butch]

Well how many head do you generally have on feed?

Not to be harsh or anything...BUT that's not a very polite way of wording such a question straight out of the chute.
I could understand ryancattle5 even viewing it as rude.

Besides the answer is right there in his name ...five :cowboy: