Cow prices

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farmerjan said:
We had a meeting recently on the LRP ....know the guy that sells it just north of here... I was wondering about the daily updates on the futures prices...
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When I talked to Jack he asked me if I want to get the daily emails. I said yes and have been getting them ever since.
 
Thanks for the link. I am considering doing this for some calves which would be sold in August. How does it work if majority of the calves will be over the 600 weights, but a couple won't quite make it?
 
It doesn't matter Djm. As mentioned your calves don't really matter size wise or quality. . Its a hedge on the market price. The only real part you must have is a equal amount (or more) of animals for the number that you hedge. No one is going to come to your farm to weigh calves but they do have the right to come out and count your numbers and to make sure they are close to the range you hedge. You do not have to do all the calves you own. If you want to keep it accurate, throw out the smaller calves and just buy a contract fore the bigger ones. Last year I had about 50 calves in all weight ranges. I contracted 40 in the 599 lb max weight.

This is a USDA program and they will notice if the numbers hedged are out of whack. For example if you buy a contract for 200 calves and they show you having only 50 acres of land, it might trigger a suspicion that something is off and they can request a visual confirmation of your calves.

If you participate in any other USDA program, they already know the basics of your land and facilities.
 
That makes sense Bird Dog and appreciate your time. This might be the first year I use it. I have 20 that should be in the 600 to 700 lb range for around first of August. Right now everything is pointing to prices staying strong, but I am not a big risk taker and these bank failures have me concerned.
 
farmerjan said:
Thanks, @Dave ... Yes I realize it is not for "his cattle" specifically, but based on the nationwide price. I wasn't sure about the selling end... thinking maybe they had to be sold at a recognized place... but then, that's a dumb thought on my part... Sometimes I can wrap my head around a concept... and sometimes it just escapes my common sense. Your explanation made alot more sense to me....
My son is good friend's with this guy... and the guy that offered him the 2.15 has always been a good trusted buyer.... so i would think the contract was very good...
I would have made the deal and been satisfied with a guaranteed price down the road... if it tanks he will really lose out... Like @kenny thomas .... sign it and be happy... trying to wring out the POSSIBILITY of more sometimes is greedy. Yes, we all want to top the sale so to speak... but making a decent amount is sometimes better than chasing the last penny...
Another good point kenny made about the location of the animals vs the sale price... yes, here we often see a bit of a discount due to the trucking of animals to more distant feedout lots...
Another reason to have made the agreement... especially with no commission costs and no drift loss...
Oh well, we shall see..
@Dave, how do you get on a list like you mentioned about getting daily updates on things like that? I go on DVAuction often to check up on prices and all...
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You never make a bad business deal that has a profit in it.
 
Went to the sale today. They had 60-70 bred cows and heifers. One guy was buying everything. He must have bought 90% of the breds. Short breds, long breds, heifers, full mouth cows, old cows. He was paying $1,650 for cows I have been buying for $1,200. I felt like telling him to swing by my place and make me an offer. I thought about running on one just to see how far he would go but I decided to keep my money.
 
Seeing more herd dispersals here. Had two people recently tell me how profitable cows are, and how kill cows will be worth over U$S 1.20 this fall. I asked them if they were buying. No...

Sounds like many fixate on what the big top dollar corn silage fed cows bring. An average hay fed cow is worth much less. This week they were 84 to 88 cents here.
 
Stocker Steve said:
Seeing more herd dispersals here. Had two people recently tell me how profitable cows are, and how kill cows will be worth over U$S 1.20 this fall. I asked them if they were buying. No...

Sounds like many fixate on what the big top dollar corn silage fed cows bring. An average hay fed cow is worth much less. This week they were 84 to 88 cents here.
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Killers were well over $1 here, the fattest brought the most.
 
Dave said:
Went to the sale today. They had 60-70 bred cows and heifers. One guy was buying everything. He must have bought 90% of the breds. Short breds, long breds, heifers, full mouth cows, old cows. He was paying $1,650 for cows I have been buying for $1,200. I felt like telling him to swing by my place and make me an offer. I thought about running on one just to see how far he would go but I decided to keep my money.
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Most of the time when I get the same idea you had, I flinch first. Unless you get one bought way back down the pole to where you can run at him all day until he sells one to you over your money, you are not hurt.
 
The most amazing thing here is how much some will currently pay for short breds in snow country. They must have trouble counting?

This kind will become very expensive fall calvers unless you have free feed.
 

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