Farm Progress is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Cattle markets will challenge your approach

vectorbomb-ThinkstockPhotos artwork of cowboy riding market
Watch each Friday for Doug Ferguson's Market Intel blog on Beef Producer and BEEF magazine.
Rising volatility is good news if you practice sell/buy marketing which offers a chance to prosper.

Earlier this week I held a sell/buy marketing school in Deadwood, S.D. I think I learn as much from doing these schools as the people who attend. Most of the folks at this one were from the north and western states. The challenges and environment are different than what I deal with at home.

One thing that made this school unique is we got to take a pasture tour hosted by Clay Conry and his family, and I am grateful they were willing to host us. Clay is the host and creator of the Working Cows Podcast. If you read this column, it is a safe bet that you’ll enjoy his shows. Clay has been podcasting for a while so there is plenty of material to sift through to satisfy your interests, and thirst for learning.

One thing that really stuck out to me during the pasture tour was how we have many of the same or at least similar grasses. The big difference is that they want more cool season grasses while I would prefer to have more warm season. The reason for this is the timing of rainfall. On average Clay’s area receives less than half of the average I receive at home. Our rainfall amount helps in forgiving our grazing missteps and can even make a grazing novice look like a genius.

One thing I have noticed is that soil and or range health seems to be much more important to producers west of me. The previous paragraph put it into perspective for me why that is. During the school there were discussions about capturing sunlight and rainfall, mineral cycles and soil health. Walt Davis had a great term for these things. He called it “Biological Capital”. To me building a healthy robust account of biological capital is a form of wealth. Like one rancher in the class told me he is in the business of selling grass. Grazing cattle is how he captures the value of that grass.

The challenge of ‘stale’ thinking

I want to share this story because I think it is relevant to success. One morning this week at a hotel lobby in Rapid City there were senior citizens waiting to board their tour bus. I overheard about every complaint there is. There was another senior citizen in the lobby that was not with the group. After the group left he looked at me shaking his head.

He started talking to me and to summarize what he told me he stated that all their problems were in their heads. They hit retirement age, and just assumed that retirement meant old, and so they started acting old and stale. He told me he was probably the same age as the people on the bus and that he could drive anywhere he wanted. He could go on hikes they wouldn’t dare think of and see things they won’t get to see. He also doesn’t have headaches and cramps or whatever other issues they came up with. To him retirement meant more time to explore, experiment and experience different things, all while not giving up the comfort of what’s familiar to him.

This guy’s comments to me just made sense. How many ranch businesses fail because the practices there are all too familiar and become stale? I talk about manifesting your thoughts in my class. If you complain about weather, markets, packers, or anything else on the long list of things cattle people complain about then guess what? The cattle business will give you more to complain about.

It was so easy to see with these senior citizens. They were getting exactly what they were focusing on. The group of negative people were focusing on the negative and having a rough trip. That guy that talked to me was focused on the positive and having a great time.

In my schools I explain what attitude is and how it affects our results. Last week I got a great example of a super attitude. I asked my daughter if she misses her elementary school. She told me middle school is where she is now and that makes it the place to be. I wished I had thought things like that years ago. It would make adapting to situations much easier.

View from the cattle market

Looking at market reports from earlier in the week the word lower comes into the conversation. In fact, anything that remained steady this week appears bullish. This market movement has caused relationships between cattle to change. With sell/buy marketing this volatility, or change in relationships allows us to step into the market and prosper ourselves. Instead of complaining like a senior citizen on a tour bus and locking up and going stale we can step in and prosper.

The price relationships vary from region to another, and within that region they can vary from one sale to another. Fly weights appear to have the highest Value of Gain. Geographical spreads are a significant factor. Buying cattle from a few hours down the road can save some money and help lead to some serious value capture.

One other thing that was lower that may help some cattle people feel a little better is the price of corn. I checked the price at our local feed mill, and it is 45 cents lower than a week ago.

Feeder bulls were up to 30 back and unweaned cattle were up to 15 back this week.

The opinions of Doug Ferguson are not necessarily those of beefmagazine.com or Farm Progress.

Hide comments
account-default-image

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish