April 2023 Cattle Projections
Each month I believe values will start to be more predictable and then we hit a few more ‘highs’ and watch a few more things that are uncontrollable impact the market.
The live cattle market continues to see new highs, but the strength needed to maintain the buying power that is occurring on replacements is yet to be seen. Cash markets outweigh the board currently, but a lot of cattle are being bought to refill pens with an uncertainty if this will remain. Supplies should continue to become tight, which should keep replacement prices high with the hopes that cash and the board will continue to support this.
Packers continue to request bigger cattle so that shackle space doesn’t have to be so competitive. The keen will remember to make sure that the cost to put that extra weight on is not costing more than the price being offered as those last hundred pounds are where most of our expense is at in regard to gain. Looking at pre-harvest products such as Hydro-Flexx and Hydro-Lac continue to bring value and great ROI’s during this time frame, also helping reduce the cost to put that pound of gain on.
Box beef moves upwards in price, harvest numbers increase from month to month, but drastically decrease from last year and overall, HCW decline; all of these putting more pressure on packers, thus their drive to purchase bigger cattle and their ability to pay up.
It’s a wild marketing time with all avenues under the microscope. Forward contracting with increased COG left some yards closing out negative margins, while those who enjoy the risk seemed to find some high reward in selling open cattle this spring.
As rains come and weather warms up stocker and grass calves will put more pressure on those refilling for the feedlot now. Competition is king currently and while yardage and interest as well as the rest of the inputs aren’t getting any cheaper, it is imperative that one knows their breakeven going into the sale barn seats of you wish to remain competitive.
The west wasn’t won by the lighthearted, and we certainly are a hardy group of producers. May you enjoy spring and all the beauty it provides, and may the rain wash away the fears of the past as we look forward to a renewal of crops, livestock, green grass and the future.