Just wondering.

[inbredredneck]

None the less, what would be your reason for not saying?

Because it is so random, it would take me some time to nail it down to a specific month. But one thing is for sure Spring is not the high. Some will say well this is futures not live sales, yes however one moves with the other. Do you see why my head spins when I hear people say markets are higher in the spring?

I just wished we the people who pour our heart and souls into this thing we call raising cattle, would put as much effort into marketing them as they do raising them. We let the boys in chicago make money on something we bled for?

In other words, one is a fool to rely on one single month every year for their livelyhood rather than keeping up with the market and doing everything you can to guarantee yourself a profit. Makes sence.

Yep a kill plant runs all year long. I need to sell cattle all year long, so I need to buy calves all year long, so somebody needs to calve all year long. Obviously that doesn't always work, and when it doesn't the packer imports cattle for kill. Then somebody else makes money(the boys in chi town).

 

[regolith]

None the less, what would be your reason for not saying?

Because it is so random, it would take me some time to nail it down to a specific month. But one thing is for sure Spring is not the high. Some will say well this is futures not live sales, yes however one moves with the other. Do you see why my head spins when I hear people say markets are higher in the spring?

I just wished we the people who pour our heart and souls into this thing we call raising cattle, would put as much effort into marketing them as they do raising them. We let the boys in chicago make money on something we bled for?

I see what you're saying there.
Supposing it comes back to some of what is being discussed in the thread on following 'textbooks'. There's an optimal way of doing things... and then there are 'rules of thumb', solid advice that will deliver an adequate result year after year after year.
It's often said that the top farmer is a week ahead of the average farmer... that means, he anticipates, makes his decisions and carries them out while his neighbour hasn't yet realised the danger/opportunity he faces whether it's lack of rain or an improving market.

 

[SRBeef]

I find this an interesting thread. Happened on it by accident. I think it would be valuable if we made the titles of our original posts more descriptive.

As far as prices go, the same thing is happening in cattle prices as in grains: traditional price patterns through the year are much less predictable than they used to be. I believe this is because we are in more of a world wide market these days - in just about everything.

If you can't rely on market price patterns - somewhat beyond our control - then let's work on controlling the things we CAN control and optimize them for our particular situation, location, climate, local resources to reduce our costs of production and improve the quality of our product. Time calving etc so it is advantageous to us, allows us to make best use of our forage, minimizes calving problems, maximizes cow life, etc.... This may be the most profitable long term approach, even if we don't always sell at the market high.

Thought provoking thread, IBRN, thank you.

Jim

 

[B&M Farms]

I've always heard calves were higher in the spring but I've never seen it. I have seen cows and replacements higher in the spring, probably because everyone has grass.

 

[inbredredneck]

I find this an interesting thread. Happened on it by accident. I think it would be valuable if we made the titles of our original posts more descriptive.

What do you think would be a good title. I had thought of a couple good ones myself, but had I used them the entire thread would have been deleted in short order.

 

[1wlimo]

Your are correct IBRN in most of what you say, however there are a few on this thread that are new to the cattle and need to learn, and sadly there are so many people that have no idea how to run a business. Look at the banks for example.

When looking at market price and future returns etc there are so many variables. Drought, rain, world economy, trade routes and talks etc. So there is still a valid discussion as to where prices may go to.

The use of futres, options, contracts etc is also not risk free. Things can go wrong very fast on some occasions. Prices rise and you fail to fill your contract for example. Buying in to fill a contract at a now high price has put a few businesses under.

 

[inbredredneck]

The use of futres, options, contracts etc is also not risk free. Things can go wrong very fast on some occasions. Prices rise and you fail to fill your contract for example. Buying in to fill a contract at a now high price has put a few businesses under.

Puts and calls are risk free.

 

[backhoeboogie]

I do not check the CME live.

Grass is my main feed. Feed prices are minimal in my operation. Feed mills are not as widespread as the used to be around here. Bulk feed like dad used is no longer an option unless you truck it in.


I have print outs for the past several years on local markets and sell freezer beef to friends at market prices. These do get fed out and the bill is passed on to them.

There are no problems with me questioning vets or vice versa. Some vets know way less than most of us. Some are gurus. We simply have to know the difference.

I have never bought back one single calve, cow, bull. Never bid on one of mine. Was prepared to PO once but didn't have to. It is a long story.

I don't risk the $5 to lock them in. You can still lose and I can tell you a long story about a good friend who did.

I've got a cost down to the penny. I like deep black but not like the way I finished in '11. Too much asset is liquidated when you sell off and you are in the calf production operation. My herd is about 1/2 of what it was. That means I will have 1/2 as many calves to market this year. But I am in the black every year operating the way I am operating.

I don't watch stock prices daily either. The only time I look is when it is time to sell. Rolled everything out back in election debates 3 weeks too early but thank God I did.

Anyway, if cattle prices tank for the next two months, so be it. I don't sell everything at once. Taking a load a month lessens the risk. I can hold off if need be. I buy heifers and put them on pasture when I do buy. They can be converted to cows - or sold. That lessens the risk too.

Cattle is a sideline for me. I do not have to make money but that is why I am in the business. I am also building for retirement from my day job and working cattle as a hobby - for profit.

Did I miss answering any of the questions in your post?

 

[dieselbeef]

not me..i just do it to keep the grass down..all 27 head

 

[inbredredneck]

Thank you for the replies.

I don't risk the $5 to lock them in. You can still lose and I can tell you a long story about a good friend who did.

Would you be willing to explain to me how this happened as I do not understand how a person could possibly lose more than the initial premium.

I don't watch stock prices daily either. The only time I look is when it is time to sell. Rolled everything out back in election debates 3 weeks too early but thank God I did.

How do you know when it is a good time to sell if you never check the markets? Seems to me that would not be the best method. Timing your sales on hopeing that it was a good time to sell after the fact, is similiar to using hope for the method birth control after having sex and hoping she doesn't get pregnant.

But I am more interested in how that individual lost money using puts.

 

[backhoeboogie]

Thank you for the replies.

I don't risk the $5 to lock them in. You can still lose and I can tell you a long story about a good friend who did.

Would you be willing to explain to me how this happened as I do not understand how a person could possibly lose more than the initial premium.

I don't watch stock prices daily either. The only time I look is when it is time to sell. Rolled everything out back in election debates 3 weeks too early but thank God I did.

How do you know when it is a good time to sell if you never check the markets? Seems to me that would not be the best method. Timing your sales on hopeing that it was a good time to sell after the fact, is similiar to using hope for the method birth control after having sex and hoping she doesn't get pregnant.

But I am more interested in how that individual lost money using puts.

You probably know him. I could pm his name to you. Of course, you do understand that everything he is telling me is hearsay.

I do check prices. Before and after I sell. Of course, right now I would be looking at last week's prices for the barn I use. My check's are not on the intervals you suggested.

Prices on a national level may or may not apply to what mine fetch at auction. Generally speaking, if prices are up, they are up. or vice versa. Selling locally has me checking local prices. I doubt I'll sell anything else until March. I've got 6 steers and some cull heifers that could go but there's no hurry at the moment.

 

[Douglas]

There is no question that historically cash calf prices have been better in the spring and lower in the fall here in north carolina. But the way to look at it is that the local basis is less negative in the spring than the rest of the year. Local demand for grass calves is highest in the spring and drives down the negative basis. Looks to me like the cme price is not a national price at all but a midwest price only.

 

[inbredredneck]

I guess history never tells the true story of what happened. People do.

 

[inbredredneck]

Looks to me like the cme price is not a national price at all but a midwest price only.

How did you come to that conclusion?

 

[TexasBred]

Prices on a national level may or may not apply to what mine fetch at auction. Generally speaking, if prices are up, they are up. or vice versa. Selling locally has me checking local prices. I doubt I'll sell anything else until March. I've got 6 steers and some cull heifers that could go but there's no hurry at the moment.

Unless it's a local individual buying to take home you can bet the family farm that the order buyers have all check CME before they left home that morning, after they got to the barn and sometimes during the sale IF the barn has a DTN hookup in the lounge or if they have the app on their phone.

 

[backhoeboogie]

Prices on a national level may or may not apply to what mine fetch at auction. Generally speaking, if prices are up, they are up. or vice versa. Selling locally has me checking local prices. I doubt I'll sell anything else until March. I've got 6 steers and some cull heifers that could go but there's no hurry at the moment.

Unless it's a local individual buying to take home you can bet the family farm that the order buyers have all check CME before they left home that morning, after they got to the barn and sometimes during the sale IF the barn has a DTN hookup in the lounge or if they have the app on their phone.

Mine have usually been dropped off there in Meridian two days before. They've experienced shrinkage. I can live with it. Or I could take a vacation day and haul them in the day of the sale and hang out to see what happens, maybe PO one

 

[TexasBred]

Mine have usually been dropped off there in Meridian two days before. They've experienced shrinkage. I can live with it. Or I could take a vacation day and haul them in the day of the sale and hang out to see what happens, maybe PO one

Dam right. It's worth the wait and when your stuff isn't selling you can get a nap.

 

[Angus Cowman]

Alot of folks on here don't think Inbred knows what he is talking about but he is dead on
Him and I have butted heads a few times and we have also had some very good and informative conversations thru pm's with No hard feelings atleast on my end
I hope I have gave him some information that made him see things differently and I know he has made me see things from another POV
even tho we were on different ends of the industry we all are working for a common goal

very good post

 

[inbredredneck]

Alot of folks on here don't think Inbred knows what he is talking about but he is dead on
Him and I have butted heads a few times and we have also had some very good and informative conversations thru pm's with No hard feelings atleast on my end
I hope I have gave him some information that made him see things differently and I know he has made me see things from another POV
even tho we were on different ends of the industry we all are working for a common goal

very good post

Thank you angus I have seen another pov thank you. However by agreeing with me you may have lost all credibility here a ct with the posse.

 

[Massey135]

The use of futres, options, contracts etc is also not risk free. Things can go wrong very fast on some occasions. Prices rise and you fail to fill your contract for example. Buying in to fill a contract at a now high price has put a few businesses under.

Puts and calls are risk free.

IBRN, unlike the posse, I've seldom seen anything you wrote I don't agree with but I had to question you here. I think you need to brush up on option risk characteristics and how you can get your ass burned real quick like with puts and calls. When selling calls or puts, the potential loss is unlimited.