Farm Talk

Livestock

November 12, 2013

Thinking outside the stocker box

Parsons, Kansas — Oklahoma winter wheat is mostly emerged and more than two-thirds is rated good to excellent condition. However, from a forage standpoint, most of the wheat is delayed in development and will need another two to three weeks before stocker turnout. This suggests that the winter grazing period for dual-purpose wheat is likely to be limited to no more than 90 to 95 days. Stocker producers should evaluate carefully what stocker alternatives will work the best in a short winter grazing season.

Feeder cattle prices have made impressive gains in the past four months. Through the summer and early fall, heavy feeder prices increased proportionately more than calves based on strong feedlot demand driven by dropping corn prices. In the past month, calf prices in Oklahoma have increased faster than heavy feeders, with calf prices up 5 to 10 percent while heavy feeder prices have increased 3 to 4 percent. This reflects the strong preference among Oklahoma stocker producers for light stockers, typically less than 550 pounds.

The result is a sharp break in feeder cattle prices in the most recent combined auction prices for Oklahoma, with prices very high and decreasing rapidly at weights up 575 pounds, and decreasing much more slowly at weights above 575 pounds. Consider the following weighted average weights and prices for Medium/Large, Number 1 steers in Oklahoma for the week ending November 1:

•475 pounds @ $203.17/ cwt. or $965/head

•576 pounds @ $174.14/ cwt. or $1003/head

•670 pounds @ $168.89/ cwt. or $1132/head

•772 pounds @ $167.08/ cwt. or $1290/head

The short winter grazing period may limit stocker gains to roughly 200 pounds. The 475 pound steer above has a gross margin of $167/head ($1132-$965) for 195 pounds of gain (670-475) to 670 pounds. This is an average value of gain of $0.86/pound. Notice that the 101 pounds from 475 to 576 pounds only has a value of $38/head or $0.38/pound of gain.

By contrast, purchasing the 576-lb. steer only costs an additional $38/head ($1003-$965). Now the gross margin for 196 pounds of gain (772-576) is $287/head ($1290-$1003), which is a value of gain of $1.46/lb. In a complete budget using March Feeder futures and appropriate basis to estimate selling prices, the 475 pound steer loses $30-$35/head while the 576 pound steer shows a positive return above costs of $35-$40/head. Feeder cattle market conditions may change rapidly and must be evaluated regularly. At the current time, there are strong reasons to consider heavier beginning weights for a shortened winter grazing period. However, the bigger beginning weights may not work when more total gain is planned. For producers that plan to graze out wheat, the lighter steer will not get too heavy before May. In a situation where the animal will be owned long enough for considerable weight gain, the value of the later gain will mostly offset the poor value of early gains. £

1
Text Only
Livestock
  • Stockers015.jpg Pressure builds on cattle prices

    With boxed beef prices down sharply from the second rollercoaster high of the year, fed cattle prices may have peaked seasonally.  
    Fed prices are currently holding mostly steady near $150/cwt. but will likely decrease into May as fed cattle marketings increase seasonally. Cattle slaughter typically increases from April through May to seasonal peaks in June.

    April 15, 2014 1 Photo

  • calving-season_ksu.jpg Shortening breeding and calving seasons

    Calves born in the first 21 days of the calving season are often the heaviest in their contemporary group at weaning, and that advantage often carries through to harvest, if the producer retains ownership.

    April 8, 2014 1 Photo

  • heifers-peel-052_fixed.jpg Late spring adds to cattle challenges

    A myriad of factors are at work in cattle and beef markets now. Spring has arrived according to the calendar but it isn’t obvious yet in many parts of the country. Cold weather continues to delay grass green-up in many regions in a fashion that is reminiscent of last year.

    April 1, 2014 1 Photo

  • Beef Talk: Are your cows ready to rebreed?

    The question of the day: Are the cows ready to breed? I hope the nutritional plan is in place and the cows are doing fine. Although nutritional adjustments can be made if needed, precalving should be a time of contentment for the cow, so all she needs to do is enjoy late-term pregnancy.

    March 25, 2014

  • How much is a good bull worth?

    I often get the question “How much should I pay for a bull?” My first answer is “Whatever the market will bear.”

    March 18, 2014

  • cull-cows.jpg Slaughter cow market following seasonal pattern — only more so

    Boning cow prices in Oklahoma City were reported at just over $102/cwt. in the first week of March. This level suggests that March slaughter cow prices will exhibit a more than seasonal price increase.

    March 11, 2014 1 Photo

  • Hollis_ksu.jpg Anaplasmosis a stealthy profit-robber

    For a disease that’s not contagious, anaplasmosis sure gets around.
    Speaking to a whole passle of beef producers at last week’s Animal Health Day in Independence, Kan., K-State Veterinarian Larry Hollis urged area cattlemen to get the costly disease in their sights.

    March 4, 2014 1 Photo

  • Livestock indemnity program retro-funded to Oct., 2011

    USDA announced it will expedite the implementation of its livestock disaster assistance program and will begin accepting applications on or near April 15.

    February 25, 2014

  • charherfcow.jpg Ark. cattle numbers up despite trend

    Arkansas cattle numbers are recovering nearly two years after the start of a drought that caused $128 million damage to the state’s beef industry, while national numbers plummet to their lowest levels in more than 60 years.

    February 18, 2014 1 Photo

  • Champions picked at Kansas Angus Futurity Jr. Show

    February 11, 2014

Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Seasonal Content