![]() "We have rallied basically the whole month," said Austin Schroeder, a commodity analyst with Nebraska-based Brugler Marketing. Growth and weight is still the most important factor in cattle income.Chicago Mercantile Exchange live cattle futures rose to all-time highs on Thursday, with signs of strong export demand and good sales on the cash market supporting prices, traders said.īut cattle prices closed lower on a round of profit-taking as traders took money off the table ahead of key government supply reports on Friday. However the market moves during the next few months, producers' focus should be on dollars per head and not just price per pound. With a current August futures market at $88, that would project to $94.00 plus in the cash market. Using basis data from August 2000, pegged 6-weight L&M1 steer basis at +$6.40/cwt. 2001 Projections of the Impact of Weight Gain and Seasonal Price Change on Steer Sale Price per Head Using Historical DifferentialsĪ dollar a pound six weight steers in August may seem a little high at this point. A projection of how prices might perform at this relatively high price level using this method is presented in Table 3. One method of prediction might be to reduce the current price level for light-weight steers each month by the same percentage as the average of the past ten years. Though it is always risky to predict how prices may behave even in the short run, using past price patterns may provide additional information with which to make a sound decision. Some producers may feel that prices are simply too high this spring to pass up. Taking into account pasture costs, interest, minerals, etc., the daily costs of keeping these calves with their mothers should run in the area of $.30 per day. Table 2 suggests that given past price history and performance, steers essentially increase in value by $.63 to $.80 per day. Impact of Weight Gain and Historical Seasonal Price Change on Steer Sale Price per HeadġInterpolated prices based on monthly averages, 1991-2001. Table 1 illustrates that adequate weight gains will offset the impact of reduced price per pound as the result of season and heavier weight cattle. Monthly prices from Virginia graded feeder cattle sales for the last ten years do have a downward trend from spring into the summer and fall. Given the producer has ample forage supplies and the calves have adequate potential for growth, history would suggest that the calves be kept on the cows until later in the summer. Virginia Graded Feeder Cattle Sales, April 2-7, 2001 WeightĮnticed by current high prices, the fall calving cow/calf operator with 400 to 550 pound calves might be considering parting with them in the spring instead of holding on to them until later in the summer. Table 1 below illustrates that even with wide price differentials paid for each weight cattle, heavier weight cattle bring more dollars per head. ![]() Those infrequent price anomalies contribute to the inappropriate emphasis on price per pound on light-weight cattle. In a few instances this spring we have occasionally seen some strange price relationships develop in which the marketplace basically paid the same price per head for 4-weight through 6-weight steers. Some cattle operators have a tendency to focus too much on price per pound and not enough on dollars per head when marketing feeder cattle. Coli and foot and mouth disease has added an additional note of uncertainly to the market. Some producers have assumed that prices can only go down from this level. Certainly, prices paid for light-weight calves this spring have been at near record high levels. McKinnon, Extension Animal Scientist, Marketing, VA TechĮxceptionally higher prices currently being paid for lighter weight feeder cattle in Virginia has some folks tempted to consider cashing in their fall born calves early. The Cattle Business - Tempting High Prices per Poundīill R. To see our latest newsletters and current information, visit our website at (through April/May 2009), and are provided for historical purposes only.Īs such, they may contain out-of-date references and broken links. These files cover more than ten years of newsletters posted on our old website You've reached the Virginia Cooperative Extension Newsletter Archive.
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