It appears that the US cattle herd is not expanding at the present time. This can be seen because female slaughter is keeping pace with steer slaughter which is a strong indicator that the US herd is remaining steady.
This is really good news because we have had a few good years, marketing wise, in a row now and usually that would cause the herd to expand so producers can take advantage of the situation. It's not happening this time for a lot of factors. The two biggest ones being the weather and ethanol.
There has been enough weather disasters that have hurt cattle producers in the past couple of years, hurricanes, drought, blizzards, that while some producers in favored areas might be trying to expand, those in the areas affected are liquidating there herds so we are keeping steady pace.
The other factor, ethanol, is easy to figure. People are just unsure what corn prices are going to look like and if there will be affordable corn to feed cattle in another year. Corn planting news out of the Midwest supports this. They are planning on planting more corn, but the weather is not cooperating and there is worries whether they will be able to get all they want planted to supply all the needs that are being demanded by the corn markets.
As usual we will have to wait and see but I'm sure glad there is no expansion going on. That really drives prices down for producers and makes life tough. Things are tough enough around here without that worry around my neck.
Don't limit yourself. Many people limit themselves to what they think they can do. You can go as far as your mind lets you. What you believe, remember, you can achieve. Mary Kay Ash
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This corn thing is all hype to drive down the prices we get for our calves this year. After processing the corn in the ethanol plants, approximately 70% of processed corn is left over and can be fed to cattle. This "mash" will begin to pile up and I would think that this should become cheap feed for feedlot operations. This should result in the movement of feedlots from Texas to Nebraska, Dakotas, Iowa, etc. Will this happen, this remains to be seen. This should be good for Montana calves.
When I was a kid during the '50's we fed "mash" from the beer breweries to the milk cows. This was cheap fed and lasted until the beer companies moved out. It seems to me that some folks are just out to make a buck at the expense of anybody. I am looking forward to good calf prices this year. We sell on Superior every year and usually get top dollar for our calves. It is all a matter of timing. I would like to hear your comments on this "mash" issue which nobody is talking about. Short of the feedlots being very close to the ethanol plants, someone is going to have to find a way to process this "mash" into pellets or something so that it can be shipped. Obviously the closer the better, hence watch for more feedlots in the North.
Paul