Beef Market Update – US Cattle Market Fundamentals Provide Bearish Outlook

[shaney]

[ASRG]

I suspect the calf market this fall will be about what it was last fall...which was pretty good compared to the last few years? However I found an old sale reciept from 2000 which showed prices quite a bit higher than 2010! Steer calves 652 lbs (nov 1/2000)....$138.50! How many jobs are paying less than they were 10 years ago? Maybe some of our government employees need to go on the "farm plan"...especially our politicians!
If steer calves sell this fall in that $1.25 to $1.30 range I think that would be a fairly optomistic number? At the sale last week in Innisfail Alberta 623 lb. steers were $1.50, and that is what is driving this bred cow or pairs market right now.....might not be so rosy come fall?
If bred cows are in that $1500 range this fall I know I'll be sending them to town!...maybe I can get a government job?

[Ruken]

So ASRG! A copy and paste from the AFSC page on prices and premiums as of May 26 for calf price protection this fall is as follows:

$/cwt 09/19 17/10 14/11 12/12
124 2.87
122 2.40 3.11
120 2.05 2.62 3.22
118 1.71 2.18 2.69 3.35
116 1.44 1.87 2.30 2.83
114 1.25 1.54 1.91 2.37
112 1.07 1.29 1.57 2.04
110 0.93 1.07 1.34 1.69
108 0.75 0.89 1.11 1.39
106 0.67 0.74 0.90 1.18
104 0.55 0.62 0.77 0.96
102 0.47 0.54 0.60 0.81
100 0.39 0.48 0.55 0.64
98 0.34 0.41 0.47 0.59
96 0.35 0.43 0.51
94 0.46

Given what you've said, is it worth it to pay these premiums to get the coverage listed?

Thoughts?

[ASRG]

I don't think so!
I had a look at the AFSC site when they first came out with the insurance scheme....and I thought...what a waste of time! I doubt anyone will sign up unless it is "required" by AFSC for a loan.....which could be a real possibility?....keep the staff busy!
My best guess is still $1.25 to $1.30...but what do I know! I'm not a government expert!

[smcgrath76]

we are possibly at a point in time in the
cycle where protecting the downside risk
is not that risky. The product may look a
lot more attractive to the C/c guy in 2015
or so. I think the feeder products must
look helpful right now.