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<blockquote data-quote="SRBeef" data-source="post: 567855" data-attributes="member: 7509"><p>I realize most of the folks on this board are focused on cattle, however given the overall picture of agriculture including crops and cattle, cattle prices in general do not offer the same opportunity for profit that crops do.</p><p></p><p>Large scale cattle ranching, in areas where there is the potential to also raise row crops, has to produce comparable income and return on the investment required as row crops or folks who are good businessmen as well as farmers/ranchers, will shift to the more profitable operation.</p><p></p><p>We can complain about the hobbyists, tax-deduction ranchers etc all we want. In the end however the economics of each type operation must compete and the more profitable use of land and investment $$ will win out. </p><p></p><p>If you look at the "dispersal sales" I don't believe that ranch land is not sitting idle, it's going to other more profitable uses.</p><p></p><p>I heard on the radio recently that we currently have the smallest calf market in the US since 1950! Now that is NOT due to tax write-offs, hobbyists skewing the market etc. It's due to the fact the economics just are not favoring cattle right now.</p><p></p><p>Either cattle prices need to come up or production needs to shift to maybe smaller, lower investment operations, or both. We have recently been IMPORTING low cost beef from 3rd world countries into the US at the same time that we are EXPORTING higher quality US beef overseas! In some cases I am aware of, trucks take US carcasses to the seaports for export and load up with IMPORTED carcasses and take them back to the midwest! Now that sure makes a lot of economic sense especially with $4 diesel! We need to look at why things like this are happening....</p><p></p><p>Overall I think that eventually the economics will determine if folks stay in cattle or shift their land and resources to other ag ventures such as row crops. I would not blame hobbyists nor tax-deduction ranchers. While those both exist, the problem with cattle producer economics in the US beef production system as we have known it in recent years is much more widespread than either of those. jmho.</p></blockquote><p></p>
[QUOTE="SRBeef, post: 567855, member: 7509"] I realize most of the folks on this board are focused on cattle, however given the overall picture of agriculture including crops and cattle, cattle prices in general do not offer the same opportunity for profit that crops do. Large scale cattle ranching, in areas where there is the potential to also raise row crops, has to produce comparable income and return on the investment required as row crops or folks who are good businessmen as well as farmers/ranchers, will shift to the more profitable operation. We can complain about the hobbyists, tax-deduction ranchers etc all we want. In the end however the economics of each type operation must compete and the more profitable use of land and investment $$ will win out. If you look at the "dispersal sales" I don't believe that ranch land is not sitting idle, it's going to other more profitable uses. I heard on the radio recently that we currently have the smallest calf market in the US since 1950! Now that is NOT due to tax write-offs, hobbyists skewing the market etc. It's due to the fact the economics just are not favoring cattle right now. Either cattle prices need to come up or production needs to shift to maybe smaller, lower investment operations, or both. We have recently been IMPORTING low cost beef from 3rd world countries into the US at the same time that we are EXPORTING higher quality US beef overseas! In some cases I am aware of, trucks take US carcasses to the seaports for export and load up with IMPORTED carcasses and take them back to the midwest! Now that sure makes a lot of economic sense especially with $4 diesel! We need to look at why things like this are happening.... Overall I think that eventually the economics will determine if folks stay in cattle or shift their land and resources to other ag ventures such as row crops. I would not blame hobbyists nor tax-deduction ranchers. While those both exist, the problem with cattle producer economics in the US beef production system as we have known it in recent years is much more widespread than either of those. jmho. [/QUOTE]
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