Feeder market taking form
Casper — Those wondering about this season’s feeder cattle market received an early glimpse at Superior’s June 2-3 “Corn Belt Classic” held in Council Bluffs, Iowa.
While the sale didn’t include as many Western cattle as upcoming video auctions will, there were some cattle from the region among the 73,000 head consigned to the sale. Superior sale results say consignments were 15 percent steer calves at 275-585 pounds, 13 percent heifer calves 300-590 pounds, 49 percent feeder steers at 600-1,000 pounds and 23 percent feeder heifers for delivery at 600-900 pounds.
Steer calves for delivery at a weight of 500 to 540 earned $108.50 to $122.00. Steer calves for delivery in the 550 to 580 range sold for between $98.00 and $112.00. Steer calves to deliver in the 600 to 640 range brought $93.50 to $112.00. Those to weigh 650 to 685 upon delivery brought $96.50 to $111.25.
Heifers for delivery in the 500 to 540 weight range brought $94.00 to $107.50. Those to weigh between 550 to 590 upon delivery brought $92.00 to $106.00. Those to deliver in the 600 to 640 range brought $90.50 to $103.50.
Asked about the wide range in prices received for cattle from the region, Superior’s Tommy Morrow says, “There’s a lot of repeat buyers and maybe some of those buyers are wanting the calves that they’ve had the last two or three years.”
Morrow says, “Another thing is vaccination, which is making a big difference this year. It’s also age and source verification, a lot of buyers are going after cattle that are age- and source-verified.”
“I don’t know what it will look like later,” says Morrow of the market, “but right now it looks like this market could be $10 to $15 a hundred less than a year ago. I don’t know what the future will bring. There are too many variables to pinpoint where the market is going to be this fall.”
“We’ve taken $30 to $40 off our calf price the last three to four years,” says Brett Stuart with Cattle-Fax. “Things are tough out there.”
Stuart says, “It’s amazing to me how wide the spreads are on cattle prices. You’ve got calf prices in any given region that will trade in a $20 band every week.”
Given volatility in the market Cattle-Fax is among those predicting cattle prices with less certainty than they historically have. “Don’t sit and wait,” says Stuart. “Don’t give yourself one chance to sell your calves. Take advantage of video auctions and forward contracting. With the volatility we have today, it’s not a good time to sit and wait and sell them in October.”
Stuart also says it’s important for ranchers to keep an eye on the futures board. Feeders in the market for cattle for September and October delivery, he says, are watching the December boards. “If I’m selling heavy feeders in August and September the guy who is buying them is looking at December futures and his cost of feeding and he backs in and says, ‘Here’s what I can pay.’”
While Stuart predicts, “cow-calf profitability will be tighter this year,” he says global demand continues to outstrip production worldwide. “The ag world is fixing to have a boom globally. When you look at what we’re doing with populations and growing incomes, we’re going to be doing everything we can to grow and expand our commodity production.”
Stuart says, “Long-term I’m positive for the cattle industry. I know it hasn’t been fun this year and there’s a lot of uncertainty and risk. I think longer term the winds are in our favor.”
“Keep abreast of the market and what it’s going to cost to feed them,” advises Morrow to ranchers looking to market feeders in the coming months. “Anything a rancher can offer to the buyer will be a plus in what he’s getting for his cattle.”
Brett Stuart was a speaker at the 2009 Cattle Industry Convention early June in Gillette. Jennifer Womack is managing editor of the Wyoming Livestock Roundup. Send comments on this article to firstname.lastname@example.org.