Cattle Prices

By September 18, 2010 Cattle


The good news is that cattle prices are higher than a year ago – in every part of the US.

This is for cows weighing 500-699 pounds, with an average weight of 575 pounds. Video sales refers to the fact that many many cows are sold these days at TV auctions and they keep good records of sale prices. Most ranchers go by them as what they should ask/pay if they are doing a private sale. And you’ll notice that the sales were at this time – for cows to be delivered over the next 90 days. That is fairly typical of how these kind of sales are handled.

I asked my friend Blair Hunewill to talk about selling for future deliver.

“This time of year, many operators are thinking ahead to the winter months.  Mid summer also has a lot of video auctions occurring.  These auctions sell cattle currently but for delivery later at some specified time.  Like for instance, last summer we listed a truckload of heifers in July that would weigh 550 in December.  Buyers that buy for future delivery often go by the futures price and often bet that it’s going to be lower than the actual price.  If that is the case, they can save thousands by purchasing cattle for less than market price.  Because futures prices are based on current commodity prices and optimism/pessimism something can come along and cause a big swing in the market making the futures prices way different than the actual price.  Those heifers last summer only weighed 250lbs when we sold them, but they were marketed for December delivery at 550lbs.  The buyer ended up paying about $.06/lb higher than market price ($33/hd) for those heifers.”

The graphic at the top is from the CattleFax newsletter.

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