We are All getting used to high prices for everything

[plbcattle]

I have nothing to back this up other than just my observation. I will look at gas.meat,grain,and milk for starters.
We get in a war,a pipeline goes down, or there is a holiday. Gas goes to $3 a gallon. We all complain. It goes down a little and we all are happy. Then something else happens and it goes over $3.30-$3.50. We again all complain. it stays high for a while and then it comes down to around $3 a gallon and we are satisfied that it came back down when we all started complaining about $3 a gallon gas in the first place.

Milk is next. It has gone up over 40% here. they blame it on higher feed costs,fertilizer, and gas prices. Well they will drop it a little and we still will be paying 20% more than we were a month ago and we are happy it dropped.

Corn is the worst. They talk about all this corn going to $4 a bushell. Were going to get cheaper gas. I hate to break it to you but that is causing meat,milk,fertilizer, and overall production of farm products to go up. We are saving here to pay more there. Us farmers are getting used to paying $250 a ton for grain and $390 a ton for fertilizer. Last year it was around $160 a ton for feed and $275 for fertilizer. So even if it drops 10-15% we will again feel like we are getting a deal when I don't get a 30% raise every year. Why is it we continue to let prices go up at 3-5 times what wages continue to rise.

College tuition for kids goes up 5-9% each year. These college kids don't get that in a raise each year. I think the government is getting us esed to paying very high prices by making these things go way up and then acting like they reduced teh cost only to realize that they went up more than our wages go up.
If I told you fertilizer would be $650 a ton in 2 years would you still use it. Well at the current trend prices have risen that is what it will be. Corn based feeds will be around $350 a ton. Gas will be in the $4 range and corn will be around $4.75 a bushell.

I was just wondering if I was the only person on here who thinks this way.

 

[tryinhard]

No, you're not the only one who thinks like that. Another thing we have been getting good money for calves for a few years, I can remember when I would think 70 cents per lb.was making money on a calf, and less years earlier. These prices we have gotten over the last few years, will change also, not so bad, but with the cost of everything else, it will make much difference to those who count the pennies. The dirt farmer is the only ones who can really afford Fertilizer, Lime, Pot Ash, etc. If it's the life you love, I guess you will ride out the storm, or be taken by it. It's not getting better. Now, it seems to be if you don't have the genetics you won't get anything for your calves, You can go out n buy a $5000.00 bull and still not see much if any difference in your calf prices. I don't think the small farmer will ever see the difference, unless he is in the registered/replacement stock part of it. I may be wrong, but it is pretty tough to pay that much for a bull, when only running 20 or 30 cows, if you don't have a good job also.


tryinhard

 

[dun]

I have nothing to back this up other than just my observation. I will look at gas.meat,grain,and milk for starters.
Milk is next. It has gone up over 40% here. they blame it on higher feed costs,fertilizer, and gas prices. Well they will drop it a little and we still will be paying 20% more than we were a month ago and we are happy it dropped.

The problem with milk is everyone thinks the dairy farmer is getting fat a these prices. The price to the producer has increased, but it isn;t much over the higher price of production. The bigger profits lie somewhere between the farmers bulk tank and the consumers grocery cart.

dun

 

[ArrowHBrand]

I am really happy for the grain farmer for the high prices, but it is killing us livestock producers. My wife and I are trying to turn a livestock hobby into a business and the price of feed is really eating into the bottom line. It's been a nice surprise for livestock producers that the price of cattle has stayed up even as the price of corn has skyrocketed, but something got to give. Traditionally the price of corn and cattle are inversely proportionate: one goes up the other goes down and vice versa. Once the cattle numbers rebound from those two large blizzards that hit the western plains, I think cattle will begin to drop. When will that happen? I don't know maybe not for a few years, let the cattle producer enjoy some up years. The high and rising cost of inputs is the reason my wife and I both have to work full time off of the ranch...for now.

 

[mnmtranching]

Did you know? That since corn went over 3.50 per bushel in Oct 06 it has already cost the American consumer over 14 billion dollars, just in food. And next year could cost 20 billion.

Check out the study done by the Center for Agricultural and Rural Development at ISU.

 

[Running Arrow Bill]

Agree... prices and supply/demand market variability hits us all and a lot is political as well as the powerful influences of the big business money cartels. Part of their strategy is to hike prices, lower them a little, then tell us what a good deal we got. The first indication I got of this phenomenon was when I was a teenager and I was shopping in one of the "quality stores" in Ft Worth, TX. They had a sale counter with every thing showing the "Regular price" and then discounted 50% price. One item I looked at had a tag partially off...the "original regular price" was lower than the "50% Discounted" price...

Our local grocery store plays a game with coffee, especially Folgers. One day or week they'll have it at $6.99 for 3# (actually 39 oz) can. The next day or week it will be kicked up to $9.98. Wait a few days longer and they'll have it for $4.99 a can: then I buy a case for $4.99 to hold me till my stash gets low and price drops again...

Milk: Usually in the $2.00 to $3.50 a gallon range. Don't see this as a problem unless you drink as much milk every week as you put gallons of gas in your vehicle tank every week. With us, we buy about 1/2 gallon a month for cooking....don't drink the stuff.

Cattle Feed: Don't use hardly any, except for special situations. Use pasture and quality hay.

Hay: Don't get me started on this topic...

 

[ArrowHBrand]

The price of hay is going up faster than my blood pressure! At the start of last winter we were paying about $30 per round bale of grass hay with delivery. By the end of the winter it was $42! Our supplier lives less than a mile away! We decided to have him cut his hay down and we'd bale it ourselves and pay $2 per small square. Put up 200 bales yesterday, really good stuff, but it may as well be bright and shiny because it's made of gold. I wish I could boycott corn as a feedstuff and only feed good hay.

 

[forageconverter]

I have came to the conclusion that the higher the prices a farmer receives, the higher the price the ‘input suppliers’ are going to charge.

If a 600 lb calf went from $1.20 per lb to $2.40 per lb live weight, then I believe a steel T-post would go from $3.50 to $7.00 and a baler would go from $25,000 baler to $50,000.

Same goes for the corn. As the price goes up, the more the ‘input suppliers’ can and will charge. The actual profit to the farmer will not greatly change. It is only the profit of the ‘input suppliers’ that will greatly increase.

(Off the subject some, but one of the most profitable ‘input suppliers’ to the ethanol(corn) business is Big Oil. As such, Big Oil is in no hurry to crush ethanol.)

 

[Sir Loin]

I thought we all agreed there were “NO POLITICS” allowed on this board!!!
I’m telling the Mod on all of you for discussing politics!
Shame on you all!

And by the way, gas and diesel is not expensive when you deduct the 50 some cents (plus or minus) a gallon in Federal, state and local taxes off the price.
The cost of gas for the last 50 years hasn’t even kept pace with inflation, if you don’t include Jimmy (peanut) Carter’s and blue dress Willie’s gas taxes.


SL

 

[63DH8]

What's going to have to happen in the end, if you the cattle raiser don't want to go broke, is not take the given price at the feedlot. If they tell you you're going to take $450 a head and it costs you $500 a head, you're not going to make a big enough profit to remain in the cattle market. You're going to have to trailer up your cattle and tell them to give you a call when they can be reasonable with their prices. It's going to hurt at first, but that's what's going to have to happen. You may have to start a co-op to provide competition to the feedlot to stay in the fight.

There are several different ways of creating profits. One is to cut your costs so you'll have more profit. Another way is to cut the middleman so you'll get what he normally gets. Another is to convince the consumor to pay more for your produce (telling the consumer your product is better than the other guy's). There are other things that allso affects profits like consumer 'preception". The consumer may think prices will go up, so they'll buy before it does. That drives prices up faster de to the lack of product. When I was living in Hawaii, my brother and I started a rumor that toilet paper was going to be in for a shortage. People started buying and hording toilet paper, thus creating a shortage and drove prices up. We thought this may have been a fluke, so we started a rumor with sugar. Sugar cane is grown and processed in Hawaii. Sure enough! Everyone bought sugar and created a shortage and drove prices up!

The same thing can be done with cattle. Cattle producers or raisers can simply say they are demanding higher prices or because of feed prices, they are going to have to demand higher prices. I've seen prices for steak vary in price from $2.60 a lb to $4.60 a lb for the same cut. That should give somewhat of a clue of what the market will bear. Want a piece of the fuel market? Tell the public or powers-to-be the prices need to be adjusted due to fuel costs. Bottom line, you're going to have to willing to back it up by being willing to trailer your cattle if you don't get what you want, and spread the word to other cattle raisers so they'll do the same.

 

[AngusLimoX]

What's going to have to happen in the end, if you the cattle raiser don't want to go broke, is not take the given price at the feedlot.

Bottom line, you're going to have to willing to back it up by being willing to trailer your cattle if you don't get what you want, and spread the word to other cattle raisers so they'll do the same.

Nothing wrong with dreaming, and you are new to the game.

Cattlemen, farmers - there will always be someone ready to pull his trailer in where you just pulled yours out.

Co-ops - what a joke.Greed kills.

It's like in aviation - there will always be enough flying schools on a field that everyone is almost starving. Too many folks willing to do it for nothing.

ALX

 

[63DH8]

What's going to have to happen in the end, if you the cattle raiser don't want to go broke, is not take the given price at the feedlot.

Bottom line, you're going to have to willing to back it up by being willing to trailer your cattle if you don't get what you want, and spread the word to other cattle raisers so they'll do the same.

Nothing wrong with dreaming, and you are new to the game.

Cattlemen, farmers - there will always be someone ready to pull his trailer in where you just pulled yours out.

Co-ops - what a joke.Greed kills.

It's like in aviation - there will always be enough flying schools on a field that everyone is almost starving. Too many folks willing to do it for nothing.

ALX

You're right. I'm new and learning your ways. Where I bolden your reply is the reason I like youse guys and would be proud to be a cattleman. You guys are REAL Americans!

I wasn't aware that co-ops were greed driven. The electric company in my area is a co-op. We have one of the lowest rates in the nation. At the end of the year, we either get our elctricity for free or we get a refund check for anything the co-op doesn't use. I wish there was a way the rancher had more control over the price of what they put their love into.

What I did in Hawaii was when I was a bored teen experimenting with psycology.

 

[mnmtranching]

What's going to have to happen in the end, if you the cattle raiser don't want to go broke, is not take the given price at the feedlot. If they tell you you're going to take $450 a head and it costs you $500 a head, you're not going to make a big enough profit to remain in the cattle market. You're going to have to trailer up your cattle and tell them to give you a call when they can be reasonable with their prices. It's going to hurt at first, but that's what's going to have to happen. You may have to start a co-op to provide competition to the feedlot to stay in the fight.

There are several different ways of creating profits. One is to cut your costs so you'll have more profit. Another way is to cut the middleman so you'll get what he normally gets. Another is to convince the consumor to pay more for your produce (telling the consumer your product is better than the other guy's). There are other things that allso affects profits like consumer 'preception". The consumer may think prices will go up, so they'll buy before it does. That drives prices up faster de to the lack of product. When I was living in Hawaii, my brother and I started a rumor that toilet paper was going to be in for a shortage. People started buying and hording toilet paper, thus creating a shortage and drove prices up. We thought this may have been a fluke, so we started a rumor with sugar. Sugar cane is grown and processed in Hawaii. Sure enough! Everyone bought sugar and created a shortage and drove prices up!

The same thing can be done with cattle. Cattle producers or raisers can simply say they are demanding higher prices or because of feed prices, they are going to have to demand higher prices. I've seen prices for steak vary in price from $2.60 a lb to $4.60 a lb for the same cut. That should give somewhat of a clue of what the market will bear. Want a piece of the fuel market? Tell the public or powers-to-be the prices need to be adjusted due to fuel costs. Bottom line, you're going to have to willing to back it up by being willing to trailer your cattle if you don't get what you want, and spread the word to other cattle raisers so they'll do the same.

When you gonna start the beef shortage rumor :?: And why haven't you done this already :?:

 

[Caustic Burno]

This is where the hobby guy is killing the industry, he doesn't count cost or doesn't care. He got his tax write off on his 25 acres and he gets to wear that cowboy hat.

 

[MikeC]

This is where the hobby guy is killing the industry, he doesn't count cost or doesn't care. He got his tax write off on his 25 acres and he gets to wear that cowboy hat.

I totally agree.

The hobby guy also has no marketing plan. He loads them up on sale day and takes whatever the buyers feel like paying.

 

[63DH8]

What's going to have to happen in the end, if you the cattle raiser don't want to go broke, is not take the given price at the feedlot. If they tell you you're going to take $450 a head and it costs you $500 a head, you're not going to make a big enough profit to remain in the cattle market. You're going to have to trailer up your cattle and tell them to give you a call when they can be reasonable with their prices. It's going to hurt at first, but that's what's going to have to happen. You may have to start a co-op to provide competition to the feedlot to stay in the fight.

There are several different ways of creating profits. One is to cut your costs so you'll have more profit. Another way is to cut the middleman so you'll get what he normally gets. Another is to convince the consumor to pay more for your produce (telling the consumer your product is better than the other guy's). There are other things that allso affects profits like consumer 'preception". The consumer may think prices will go up, so they'll buy before it does. That drives prices up faster de to the lack of product. When I was living in Hawaii, my brother and I started a rumor that toilet paper was going to be in for a shortage. People started buying and hording toilet paper, thus creating a shortage and drove prices up. We thought this may have been a fluke, so we started a rumor with sugar. Sugar cane is grown and processed in Hawaii. Sure enough! Everyone bought sugar and created a shortage and drove prices up!

The same thing can be done with cattle. Cattle producers or raisers can simply say they are demanding higher prices or because of feed prices, they are going to have to demand higher prices. I've seen prices for steak vary in price from $2.60 a lb to $4.60 a lb for the same cut. That should give somewhat of a clue of what the market will bear. Want a piece of the fuel market? Tell the public or powers-to-be the prices need to be adjusted due to fuel costs. Bottom line, you're going to have to willing to back it up by being willing to trailer your cattle if you don't get what you want, and spread the word to other cattle raisers so they'll do the same.

When you gonna start the beef shortage rumor :?: And why haven't you done this already :?:

What I posted is based on simple economics.
1. I don't have the leverage. I'm not presently raising beef.
2. For this to work, it'll take the cooperation of more than one person raising beef or a person with enough public notoriety for people to pay attention.
3. A point was made and I agree. I'd rather be honest and not take advantage of people even if it hurts some or puts me out some. I learned since I was a kid. I learned about honesty, honor, and respect.

 

[63DH8]

This is where the hobby guy is killing the industry, he doesn't count cost or doesn't care. He got his tax write off on his 25 acres and he gets to wear that cowboy hat.

If mnmtranching would have read and processed my previous post, he or she would have understood this is an item that was addressed. Without enough people standing up and saying the price offered is too low, cattle profits will remain low. Too many people are accepting low prices and everyone else is stuck with them. This is the simple economic part.

I'm out of this thread. I'm not getting into a p*ssing contest.

 

[Brandonm2]

This is where the hobby guy is killing the industry, he doesn't count cost or doesn't care. He got his tax write off on his 25 acres and he gets to wear that cowboy hat.

If mnmtranching would have read and processed my previous post, he or she would have understood this is an item that was addressed. Without enough people standing up and saying the price offered is too low, cattle profits will remain low. Too many people are accepting low prices and everyone else is stuck with them. This is the simple economic part.

I'm out of this thread. I'm not getting into a p*ssing contest.

IF YOU don't like the price then get out of the business and go to work for Wal-Mart full time. You got four choices with commercial cattle.....1) drop em off at the sale barn and accept your check 2) stocker them until the market get's stronger 3) send em on to the feedlot in some sort of retained ownership scheme or 4)grow them out yourself and attempt to find buyers for all those sides of beef. IF every American rancher went out of business we will still have plenty of product on our shelves from Canada, Mexico, Australia, Argentina, New Zealand, Uruguay, and/or Brazil.

 

[AngusLimoX]

[ IF every American rancher went out of business we will still have plenty of product on our shelves from Canada, Mexico, Australia, Argentina, New Zealand, Uruguay, and/or Brazil.

You sure Brandonm? We are 2% or less of the US cattle market, I didn't know any of the others had that many head?

On plb's point - I wonder where input costs are going on corn ( seed, fert, chemicals, ) and once biofuels dies down whether they will come back to pre-ethanol boom prices?? :roll:

They might come back down a bit, and we will accept it.

ALX

 

[Workinonit Farm]

This is where the hobby guy is killing the industry, he doesn't count cost or doesn't care. He got his tax write off on his 25 acres and he gets to wear that cowboy hat.

I totally agree.

The hobby guy also has no marketing plan. He loads them up on sale day and takes whatever the buyers feel like paying.

:nod: :nod: :nod:

Katherine