Load of steers--should we do it?

[tncattle]

We sold all our bred heifers and the bull, he was 5 1/2 and getting a little attitude so hes burger now. Two years ago when we were selling a bunch of pairs a man came and looked that also runs about 5000 feeders/stockers a year. Anyway, he was saying we should run 80-100 calves for 4-5 months. He said we can contract back before we actually buy them so we know our margin. Is he saying we contract back at an agreed price no matter what the market is at selling time?

 

[Dave]

I have a friend who does just that. He is running about 1,000 head. He sells with an open ended delivery but with a target weight. I believe his delivery period runs from June 1 until late August with a target of 850 pounds on the steers and 800 on the heifers. He has done real well. He has other stipulations such as the vaccination program and allowable breeds of cattle, I am not certain on all of those.

 

[RanchMan90]

Futures board is around $1.40 for Aug-september feeders. I would recommend starting out with a small number or holding your home raised calves over as feeders to determine your personal cost of gain, value of gain, and vet protocol. Contracting is a good form of risk management but also locks you in a box. Check out Gordon hazard's book. Just my 2 cents

 

[TennesseeTuxedo]

Futures board is around $1.40 for Aug-september feeders. I would recommend starting out with a small number or holding your home raised calves over as feeders to determine your personal cost of gain, value of gain, and vet protocol. Contracting is a good form of risk management but also locks you in a box. Check out Gordon hazard's book. Just my 2 cents

Good advice.

 

[shaz]

Are you seeing a decent spread between 500-900lbs? I took the average weight and price on 5wt steers and compared it to 9wt of the same frame and came up without about $200/hd difference. Maybe I'm missing something ..

 

[RanchMan90]

Are you seeing a decent spread between 500-900lbs? I took the average weight and price on 5wt steers and compared it to 9wt of the same frame and came up without about $200/hd difference. Maybe I'm missing something ..

It pays to ship feeder cattle to OKC. Doesn't pay much at all to take one over 700 lbs. Just what I'm seeing.

 

[Dave]

The key to what this guy told you to do is contracting them before you buy them. The guy I know who does this is often buying calves for less money per pound than he has them contracted for. I would ask the guy who told you that you should do this if you can tag your 80 head into his 5000 head. The guy I know who does this started because he got in with a couple guys who run 7-8 thousand stockers. He only had about 100 head when he started this. As I said before he now runs about 1,000 head.