Monday, July 30, 2012
Most of you that read this blog know about my focus on VALUE of gain. This is from Glen Selk's latest newsletter: "Notwithstanding current production difficulties, the market is providing strong signals to add weight to feeder cattle before feedlot placement. For example, 525 pounds steers have averaged about $140/cwt. the past two weeks in Oklahoma. Adding 225 pounds at 1.5-2.0 pounds per day would produce a 750 pound steer by November. Using a November Feeder Futures price of $144.90/cwt and zero basis results in a gross margin of roughly $350/head or a value of gain of $1.56/lb. The extent to which this is a good market opportunity will depend on the cost of production but even with relatively expensive feed costs, a cost of production well under this value of gain is likely. While many producers are unable to take advantage of this situation, there are undoubtedly some producers with the ability to implement a stocker or backgrounding program to take advantage of this very high value of gain." Value of gain at $1.56!!! Now if we can get a rain or two we can take advantage of a tremendous opportunity!
Saturday, July 28, 2012
It would be easy to feel sorry for ourselves given this ridiculous heat and associated drought. The grass isn't even brown anymore, it's white. But mob grazing has allowed us to stockpile grass and calculate exactly how many days of grazing we have remaining. We added 108 head of our stocker calves on July 17th(avg weight 652#)to the dry cow mob bringing our mob size to over 500 head. While everyone else is liquidating, we have at least a month of remaining forage while carrying about 25% more animals at the goat ranch than we had last year. It's certainly been a challenging summer, but mob grazing has allowed us to get ourselves well prepared. We will likely be selling all of our purchased dry cows and our stocker calves in early September...hopefully the markets will have rebounded by then. If we get some rain, and the markets haven't rebounded, we may try to hold the stockers a bit longer, but the cows will likely have to go. Our most immediate challenge is to figure out where to merchandise our purchased cows in early September. The Joplin market is beyond awful right now. The cows are fat and more than likely, many of them are pregnant. It would be a shame if we don't end up making a healthy profit on them, but given the circumstances, I would probably be happy if we break even.
I've mentioned this many times before, high priced corn is not necessarily a bad thing. Cattlemen like to complain about it because the major publications generally rail on high corn because they are mouthpieces for large scale beef. But high corn can be a tremendous opportunity for cattlemen. High priced corn increases the value of your grass, and if you are a grass farmer, increased grass value is a good thing. Stop complaining and figure out how to take advantage of the windfall.
Wednesday, July 11, 2012
I've mentioned this in a past blog post, but a not so obvious benefit to mob grazing is the ability to harvest seed from pastures yet to be grazed. Although we currently have more cows at the goat ranch than we have ever had there (over 600 head) we still had nearly half the ranch that had not been grazed by mid-June. We cut those pastures for seed and with the price of seed this year, did quite well. Cutting the seed also removes the seed heads from the pastures that can carry fungus and harm eyes. I suggest rotating where you cut seed so that you can maintain a seed bank, but cutting this seed has many advantages, not the least of which is a nice paycheck. It's been record hot this summer and very dry, yet we still have around 400 acres that we have yet to graze. A huge benefit to managed grazing is knowing how many grazing days you have left at any given time. We calculate that if we don't get another rain, we have around 65 days of grazing left, which should allow us to get to early September with the cows and calves we want to send to market. Until then, I will continue to hope that it starts raining and prices will rebound.
Monday, July 2, 2012
It's been record hot for the past week or so but it's a fairly typical SW Missouri summer. The cows are hot and taking to the ponds. This is a real problem with mob grazing and one of the biggest challenges in the summer. As I've shared in the past, a mob of cattle can do real damage to ponds and water quality. We have had a few fish kills that were not pretty (see prior posts for pictures). We have decided to try to fence the cattle out of the ponds and pump water to a stock tank. I am not a fan of spending money on equipment like this, but I really think the payback will be fairly quick, especially if performance is suffering due to water quality (this is very debatable, I've seen studies that show this both ways). We will start using the pump and tank hopefully this week...I'm anxious to see how the cattle react. I think providing good, cold water to the cattle in the mob can only be a positive.