November 2022 Cattle Projections
November cattle projections show a wide spread in cost of gains (COG) when looking at cattle type and efficiency. Runs of yearling cattle are fairly dried up and the calf fall run seems to have hit its second wave that occurs when most farmers have wrapped up harvest and are looking to fill pens. This competition will continue to see calf prices rise. As we look to the futures a bit, the cost of that calf may continue to stay high once heifer retention begins to rebuild the record low cow numbers.
A few things need to continue to line up in order for this to occur, most notably having enough fiber whether that be grazed or harvested forage to feed these animals to breeding age and beyond. Getting enough moisture to provide winter grazing and/or enough hay to feed replacement animals will start once our drought levels are reduced throughout the cattle feeding industry. Once retention starts to occur heifer values may start to rival steers to get them into pens. As pounds of produced beef are reduced due to shear number on feed and the U.S. dollar is weakened, this brings forth the challenge of consumer buying due to cost of U.S. beef vs imported beef.
If inventories start to dwindle, packers will be looking to forward contract to reduce their risk of spot purchases, leaving some opportunities for a volatile open market that may be positive in some cases. Perhaps with current and projected calf prices, this is the mindset of many producers as they purchase cattle above their break-evens.
Remember to discuss both management and technologies to help you remain competitive in the current market landscape with your Form-A-Feed nutrition and production specialist.
As always, please feel free to reach out with any questions you may have.