The Cattle Business -- Avoiding "Grass Fever"
Livestock Update, February 1999
Bill McKinnon, Extension Animal Scientist, Marketing, Animal and Poultry Sciences, Virginia Tech
Early 1999 has been met by a sharply stronger feeder cattle market. The firming of the fed cattle market is beginning to finally bring some black ink to feedlot closeouts. Improved moisture levels and mild temperatures have improved wheat grazing conditions in the southern Plains and strengthened the demand for light-weight stockers. Additionally, it appears that local folks have taken an early start to putting their grass cattle together.
Before stocker cattle buyers start chasing light-weight feeders like there will never be any more made, they need to get their booster shot against "grass fever." Grazing yearlings during the disastrous 1998 season should have served as a one-time vaccination, but some folks seem to need a booster.
The spreadsheet can serve to help producers work through the math before bringing home cattle that have an unrealistic chance of breaking-even. Most animal science specialty Extension agents have access to the spreadsheet to assist stocker cattle operators.
At this point in time the outlook for fall feeder cattle is somewhat brighter than last fall. There appears to be smaller supplies of feeder cattle outside of feedyards with the 1998 calf crop the smallest since 1952. The feeding industry is in a better profit situation than 1998. Cattle feeders must begin to market cattle in a more timely basis to prevent the heavy carcass weights of last year and that continue into 1999 from forcing beef supplies to abnormally high levels. Current feeder cattle futures project prices for loads of good quality 8-weight steers in the $70-$72 range. Those predictions are always vulnerable to poor corn crop conditions, uncurrentness in the fed cattle markets, and many other factors.