Whats Up?

[kenny thomas]

traderaaron, good post. Can you say why people are still paying the 1.26 for the 600#"? It just does not figure out when compared to the heaver cattle.

 

[novaman]

traderaaron, good post. Can you say why people are still paying the 1.26 for the 600#"? It just does not figure out when compared to the heaver cattle.

Sometimes things won't figure out. There are times when you must take a loss in order to keep a cash flow going. This appears to be one of those times where the feeders are willing the pay more than they should for cattle in order to keep the feedlots going.

 

[traderaaron]

traderaaron, good post. Can you say why people are still paying the 1.26 for the 600#"? It just does not figure out when compared to the heaver cattle.

Sometimes things won't figure out. There are times when you must take a loss in order to keep a cash flow going. This appears to be one of those times where the feeders are willing the pay more than they should for cattle in order to keep the feedlots going.

Green grass is why 600# cattle are overvalued but they really aren't that high and not the highest they've been this year relative to Fat Cattle. Against Fat Cattle and my .80 cog of gain it's only overvalued by $16, often time ranchers running yearlings are overpaying by $100 or more.

My rule is to never buy cattle overvalued or the worst buy on today's market or against whatever you are selling. So I could simply buy the 900# cattle and if I just sold 1300# Fats for $100 and upping my COG for the heavier cattle to .85 to compensate it's still cash flow positive transaction by $24.45.

A better buy than that at OKC west from looking at the report were the 800# Feeder Heifers at $102.25. The person that put the weight on from 700 to 800 on those was likely not paid for that by the market unless they are running a COG probably less than .45.

Buying grass cattle is one of the hardest things to do because they are consistently overvalued.

 

[1982vett]

Buying grass cattle is one of the hardest things to do because they are consistently overvalued.

Buyers perspective only.........

 

[Howdyjabo]

The buyers perspective is the only one to consider.

 

[traderaaron]

Buying grass cattle is one of the hardest things to do because they are consistently overvalued.

Buyers perspective only.........

Well, the answer to all that for most cow/calf and stocker folks is to sell what the market wants when it wants it.

My answer is to buy heifers, bigger ones and little ones, the steer heifer spread at times in the winter and spring can get pretty wide.