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Feb 17, 2022 | 21:32
31
Does anyone actually care besides those of us in the business? Sad, but I think that's reality, if the beef heard mostly disappeared in Canada what difference would it make. Government doesn't make much for tax dollars and helps solve the environmental wackos issues. Average consumer is happy with cheap Brazilian burgers at walmart, less people every day willing to buy an expensive steak. Only hit I can see is the lack of feed grains that would be needed would be hard on grain prices but not too many straight grain guys seem to understand that.
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Feb 18, 2022 | 10:04
32
 Originally Posted by 15444
Fuel, fertilizer, drought, equipment prices and rising interest rates for overleveraged producers are going to be the perfect storm in 2022.
Be a lot of ag producers of all kinds exiting in the next year, not just cattle guys. Unless of course grain prices maintain and cattle increase 50% by fall. Even 50% might not be enough for some guys.
I'm going for a full double in price. I think COP this year will be a big step up.
Grain prices are already locked in for this year. Cattle futures prices are in also. The drought is already affecting the central states Oklahoma , Kansas and the rest. We will have an issue with runoff this spring (flooding) and a drought this summer.
Interest rates are set to rise. The Cattle Industry in Canada has been drinking their own Kool-Aid and believe their own numbers. So it's going to be a surprise for them.
What to do? De-populate to a core herd and wait this out? Will future prices offset the money you put in now?
What are your thoughts on how to survive?
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Feb 18, 2022 | 13:41
33
Watching todays blizzard I'm trapped inside for a while .
In order for this to be sustainable there needs to be a pricing system that recognizes the real cost of producing a live healthy calf. The cow calf producer cannot support the entire industry.
Backgrounders and feeders take the increased cost of grains from the cow-calf producer. Double hit for the cow calf producer who is paying those same increased costs to sustain the productive herd and then suffering the drop in income. You would think the industry would recognize this and take steps to ensure the cow calf sector is taken care of. The current zero sum process of cow calf sector loses and all others can prosper won't last.
It appears that the cow herd needs to drop in size more than what the drought is forcing.
There is already a big difference in numbers that are currently in use by the Government and the Beef Industry Organizations. What are the real / actual producer and cattle quantities? The real numbers are what will count going forward
The backgrounder and feeder sectors will be challenged trying to under pay for calves that don't exist.
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Feb 19, 2022 | 01:20
34
Originally Posted by The Don
I'm going for a full double in price. I think COP this year will be a big step up.
Grain prices are already locked in for this year. Cattle futures prices are in also. The drought is already affecting the central states Oklahoma , Kansas and the rest. We will have an issue with runoff this spring (flooding) and a drought this summer.
Interest rates are set to rise. The Cattle Industry in Canada has been drinking their own Kool-Aid and believe their own numbers. So it's going to be a surprise for them.
What to do? De-populate to a core herd and wait this out? Will future prices offset the money you put in now?
What are your thoughts on how to survive?
Staying out of debt, or getting out of debt as soon as possible should be at the top of every beef producer's mind. Keeping costs as low as possible and building equity while riding the next price curve upwards, might give guys a chance to survive long-term.
I know of a few new local people itching to get into cattle or expand after this past year. Personally I think their dreams are bigger than their bank accounts.
This winter, multiple cattle guys are losing rented pastures and fields to crop guys upping the rent. Also, you are seeing guys playing it too tight on the feed supply and shipping backgrounded calves earlier than expected to save hay for the cows. My calculations say at the current prices, those guys fed calves up to this point for a considerable loss, considering what feed is worth.
In the US, buddy in MN told me this past week he is seeing a lot of 100-150 cow dispersals. Guys ran out of feed (or money). These aren't old guys, buy young guys that would have had another 30 years in the industry. US eliminated 1.3 milion beef cows in 2021 alone. Waiting the see what Canada's numbers will be like. I would be very surprised if at least 20% of the beef cows are not gone from this country.
I would have to check, but I think January 2021 Canada beef cow numbers were around 3.5 million. I think we could shave at least 500,000 off that number and we might see something that resembles a respectable and profitable price.
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Feb 19, 2022 | 07:21
35
IMHO the problem is the beef cycle has been going into the high end of the price but the packers are able to keep all the increase.
Some advantage will swing to the producer as market ready supplies of live cattle fall but packers seem to be happy to run lower volume at much higher margin as there is little actual competion in the beef to retail supply.
A roast beef at Costco is $70 and burger meat is $5.50 on feature.
They are happy running the plants at lower volume.
Don't rock the boat?
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Feb 19, 2022 | 14:25
36
Even if you have everything paid for the prices you are getting won't pay for repairs ,maintenance, depreciation, labour and a return on the investment. Current feed situation here requires bringing money to the operation. Is hanging on worth the investment or is it good money after bad? I've already downsized a bunch. Can't afford to lose more.
Guys who want to jump into the market are not using realistic numbers for their cash flow projections. They may have been drinking the Kool-aid. Current prices and the future prices into 2023 won't support
maintaining the herd not thinking of expansion. That's my opinion (without a long discussion of how every producer has a different COP).
The packers are not running slow they import subsidized cattle from the US. Last year they imported 300,000 cattle into Alberta feed lots. That's the numbers that the USDA had posted. I think that was close to all the calves and cows coming out of Manitoba (330,000). Cattle marketed at a discount because the feedlots were full and there was a "backlog" to get into the plants.
Manitoba Agriculture think a 2022 price for 8 weight steers @ $200 / hundred weight is wonderful money. But it's costing the cow calf guy $1600 to produce a 5 weight calf.
There needs to be a change in the Canadian market where the industry recognizes the real cost to produce a calf in Canada.
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Mar 1, 2022 | 11:04
37
28 quarters of pasture listed around here for 5 million+
I can't pencil it out to make sense of something that struggled to adequately handle a 250 cow calf operation.
The guy just did a major reduction to keep the base herd. Now its going to be retirement.
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Mar 2, 2022 | 18:47
38
What percentage is lease land bucket….is there potential for grain farming….that is 5 to 6 quarters worth here in the Red Deer area.Land is a hot commodity makes no sense one would think production wise.
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Mar 3, 2022 | 08:50
39
I don't know where that land is and what it's worth. The one thing I can say is that the cattle won't pay for that.
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Mar 3, 2022 | 09:11
40
Originally Posted by blackjack
What percentage is lease land bucket….is there potential for grain farming….that is 5 to 6 quarters worth here in the Red Deer area.Land is a hot commodity makes no sense one would think production wise.
Wouldn't 6 quarters at Red Deer run more than 250 cows?
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Mar 3, 2022 | 09:33
41
Normal conditions right on the bubble if one was going to cover winter feed and summer pasture needs…summers like the last one no…our operation runs cows on marginal land in summer while the good producing land for winter feed and some cash crop….but Don is right in saying it doesn’t make much sense to ranch at current feeder prices….
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Mar 4, 2022 | 09:32
42
It sounds like a lot of money. When you put a pencil to paper 28 quarters (4,480 acres) for $5million is around $1,100 / acre. That sounds like someone's lifetime of work to acquire that block of land. Hopefully they can get paid a reasonable return for their hard work.
How the next generation of cattle producer will pay for that is a real good off farm job and a desire to throw money away. Or...?
There was an article in the Western Producer where MBP top brass were restating how optimistic they were! Assuring producers that the prices were going to increase this year. Maybe as much as a dollar a pound! But feed prices need to come down for that to happen.
Wow! If I add a dollar to what I got paid last year I could get to around $1500 for a 5 weight calf. That's still a hundred dollars below the projected cost of production. Put that together with the money lost and interest I'm paying for carrying last years losses and I get right back to where the price needs to double.
Fertilizer price tripled. Herbicide tripled. Fuel prices are up in a big way. Grain prices are up and staying up (so forget the feeder's grain prices dropping). Interest rates are going up.
The idea that a dollar increase is a big deal is ridiculous.
Prices for the cow calf sector need to double!
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Mar 5, 2022 | 20:34
43
Talking to neighbor last night asking when he was going to ship his steers. 7-weights. Couple potloads. Winnipeg telling him they figure $1500 average on them. Realizing he just fed his own feed plus extra he bought for basically nothing. Would have been further off selling in fall and selling the feed.
Myself I'm planning on grassing the yearlings. Might sell the fall calves in spring as it looks like those 6 weights will be hot commodity in late April for grass guys.
At the price of all inputs, the days of $2.00 calves is over. $3.00 will have to become the norm or the exodus of producers will be massive in the next couple of years.
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Mar 9, 2022 | 13:35
44
Yes the prices need to go up for the cow calf producers. Three dollars a pound may not be enough.
Just spit balling numbers. Those 7 weight animals probably cost a bunch of cash to get through the winter.
$1615 to get to 500 pounds and then around $550 to get them from October to March. Total cost roughly $2165. Getting paid $1500 translates to a $665 a head loss. The feed they put into those animals generated a negative value. I chose to loose my money in the fall in an effort to save myself a lot of labour and money (buying feed to help someone else make money). I did that (holding the calves over) last year and didn't want to repeat that mistake.
That story does not bring me any happiness. Somebody did a lot of work and invested a bunch of money to produce those calves. Then they got screwed over.
Looking at the futures numbers they don't support any better prices than what that example shows. So I'm less optimistic than the guys that run MBP. They get all excited about a $50 dollar price increase when you are losing $500. Price insurance for $2.30 a pound on a product that cost you $3.05 to produce is nothing to be happy about.
The cattle herd has shrunk according to statscan. They show that 1 January 2022 the beef cows on cow calf operations were 363,300 I think their number is way too optimistic I think the real number is probably 330,000 and it will drop to less than 300,000 this summer. ( that's a 10 % difference in the number) Last summer they thought there were 401,700 beef cows on Manitoba cow calf operations. The recent posting showed a corrected (different) number of 372,700 (that 29,000 head difference is +/- 10%) .
In February USDA said Canada imported 1300 tonnes of (US Government subsidized) beef. That's a lot of cattle.
Who do you call to complain?
Call them now!
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Mar 15, 2022 | 14:00
45
I had to buy fuel... $1.51 / liter I ordered 500 gallons $3428.00 Current price of cows I need to sell 5 cows to pay for enough fuel to get me to grass time.
I need to buy some more feed probably $8000.00 should get me to grass I need to sell off 11 cows for that.
I can drop one bull and 20 cows that should get me to the expensive time of year.
I'll be out of cattle by the end of seeding time as this goes along. Save me a bunch of money for next year!
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Mar 16, 2022 | 15:12
46
Originally Posted by The Don
I had to buy fuel... $1.51 / liter I ordered 500 gallons $3428.00 Current price of cows I need to sell 5 cows to pay for enough fuel to get me to grass time.
I need to buy some more feed probably $8000.00 should get me to grass I need to sell off 11 cows for that.
I can drop one bull and 20 cows that should get me to the expensive time of year.
I'll be out of cattle by the end of seeding time as this goes along. Save me a bunch of money for next year!
Last fuel buy was a week ago at $1.91 for coloured, supposed to go up to $2.15 on next delivery. Bought one extra load of 38 rounds for $8012.00. Freight portion was $4400 a load and going up more in future. Bought 10 ton fertilizer to do fields that were missed last year. $1105/tonne, up 68% from last year. Would be a hard sell on any of it if I didn't have cash to pay for it.
I know a lot of older guys are calling it quits and scaling back this year. Just heard that one neighbor quietly liquidated 1/2 his cows over winter, he wasn't buying any extra feed. He's 65 and can't get son to help anymore as son has had enough marital issues and bank debt to pay off, he doesn't need hassle of cows after clocking out of day job.
Another neighbor just listed all his equipment for sale. No prior notice, nothing. General thinking is that family is in tight spot finance wise and needs to raise cash quickly. Already sold the loader tractor that he uses to clear snow out of the house yard with...that really got his next door neighbor wondering what was going on.
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Mar 18, 2022 | 13:28
47
I screwed up a download of statscan's site information regarding cattle numbers... I'll try again later to post that.
Cattle numbers are dropping and the number of producers is dropping in synchronization (as one would expect). It doesn't seem to be a great concern for the folks at Canadian Cattleman's Canfax group. Spokesman Brian Perillat was thinking that the liquidation was "not as bad as some have feared" He said in a recent article that the current cull rate at 13% was in line with recent years cull rates. Looking at the cows on farms in Manitoba they have dropped 76700 or 18.83% from 2018 to 2022. I guess that a +/- 20 % drop in cows is no biggie in the eyes of the Canadian Cattleman's organization. Why do these guys qualify for national check-off funding? Especially with that kind of attitude! There is a story of a lot of hurt and personal sacrifice in those dropping numbers.
I think the "big drop" is going to happen this year. In my opinion the number of both cows and calves will drop significantly this year. The combination of poor / limited (but expensive) feed and a harsh winter will show up in the form of a reduced calf crop and a bunch of culled cows.
But. Don't expect an increase in prices paid for those calves and cows. The most recent increase in grain prices made the feeders drop the price paid for feeder cattle by a matching amount. Again a double hit for the cow calf guys. That has to stop.
What year was it they expected a "wall of calves" (so they didn't pay a good price for calves)? That "wall" that never arrived! Maybe it was the first item in the "supply chain disruption problem"!
Last edited by The Don; Mar 18, 2022 at 13:36.
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Mar 18, 2022 | 23:11
48
Originally Posted by The Don
I screwed up a download of statscan's site information regarding cattle numbers... I'll try again later to post that.
Cattle numbers are dropping and the number of producers is dropping in synchronization (as one would expect). It doesn't seem to be a great concern for the folks at Canadian Cattleman's Canfax group. Spokesman Brian Perillat was thinking that the liquidation was "not as bad as some have feared" He said in a recent article that the current cull rate at 13% was in line with recent years cull rates. Looking at the cows on farms in Manitoba they have dropped 76700 or 18.83% from 2018 to 2022. I guess that a +/- 20 % drop in cows is no biggie in the eyes of the Canadian Cattleman's organization. Why do these guys qualify for national check-off funding? Especially with that kind of attitude! There is a story of a lot of hurt and personal sacrifice in those dropping numbers.
I think the "big drop" is going to happen this year. In my opinion the number of both cows and calves will drop significantly this year. The combination of poor / limited (but expensive) feed and a harsh winter will show up in the form of a reduced calf crop and a bunch of culled cows.
But. Don't expect an increase in prices paid for those calves and cows. The most recent increase in grain prices made the feeders drop the price paid for feeder cattle by a matching amount. Again a double hit for the cow calf guys. That has to stop.
What year was it they expected a "wall of calves" (so they didn't pay a good price for calves)? That "wall" that never arrived! Maybe it was the first item in the "supply chain disruption problem"!
What I am hearing more and more approaching spring is, if kill cows of all types can hit the dollar mark this year and stay, you won't see the doors for all the people clammering to get out this summer/fall.
Guys are telling me, "there is a life outside of cows..". I personally disagree, but I was pretty much born in a barn, so I'm a little biased.
The industry is based around guys who love their momma cows and calves and wanted to die doing it; problem is they are getting ancient and doing just that.
Next generation views it as a business and when the numbers don't work anymore, cows and machinery go. No tears shed. Lease out the land and bring in the croppers. Cash the rent cheque and go on scenic vacations.
We are now at a point where were are starting to lose both segments and the sector contracts massively.
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Apr 11, 2022 | 11:38
49
Waiting now for the next weather event. It's supposed to be a doosey!
Looking at the things I would have liked to fix / replace that would have made things better and safer to operate a cow-calf enterprise. No money to do any of that.
Has anyone else noticed that the drought is the only thing acknowledged for the herd reduction? Any of the information sources that I watch have focused on the drought. No one mentions the fact that a lot of cow-calf operators haven't made enough money to have the necessary reserve to survive the drought and down market.
I hope everybody stays safe!
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Apr 11, 2022 | 22:09
50
If this storm is as forecasted it will be a calf killer! If you have good facilities and shelters it may help. About 10 years ago we had a bad storm end of April lots of calves lost and even old crock cows, some guys cut the cows and calves loose in the bush for shelter they fared better than most herds in corrals.
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May 2, 2022 | 15:22
51
So they had one job to do...
The feds gave Manitoba Agriculture 93 million dollars to distribute to drought affected producers in Manitoba. Manitoba government added 62 million to the pot. Which sounded good 155 million available! Then came the implementation phase and things went south.
So by 23 March 2022 they had only managed to distribute 32.16 million to 2508 claimants. That's only 20.7% of the total amount provided. The time that the cow-calf producer needed the money was last late last summer and last fall. Not next year.
So what went wrong? My opinion is they have been using flawed data for so long they believe their own numbers. They have made it all about getting the absolute minimum amount of money into the hands of the base producer. So little in fact that they still have 80 % of the funds still in the bank. When I say they I mean the Manitoba Government and their advisors Manitoba Beef Producers (the organization).
The only option cow-calf producers have is to go out of the business. They are offering $250 / head one time payment for herd expansion. You will lose $800 / head at current prices per year going forward. Not much incentive in my opinion.
The numbers are dropping in a big way now. What the lack of money doesn't eliminate Mother Nature is taking care of.
I'm going back out to the swamp that I have for pens to see if I can get the tractor stuck again. I'm grumpy!
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May 11, 2022 | 22:21
52
Well the tally keeps growing around here as to who is out this fall. So far 3 cow/calf guys are out and I would not doubt maybe a 4th. And this is just within a few miles of my operation. Talking with a friend, neither of us doubt at least 1/4 of the cow/calf guys are gone this fall. Especially with decent cull prices and pathetic calf/yearling prices. Death losses through the roof this spring, especially with pneumonia.
And it's a mix of young guys with their neck out too far and old guys who are just completely wore out.
Was hoping to sell fancy breds this fall for a premium, but looks like market could very well be flooded with breds.
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Jun 14, 2022 | 14:05
53
So we are supposed to be thrilled with the 70 to 90 cents a pound they are paying for cull cows.
Here is a picture from the archives.
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Jun 17, 2022 | 12:48
54
If you do the math on that 1990 dollars current value is listed @$2.24. So 71.75 / hundred weight is equivalent to $160.72 /hundred weight.
That's not counting the recent crazy inflation cycle.
Those cull cows that have been selling for $45 to $60 dollars with $6.00 to $7.00 a pound hamburger is making the Packers a lot of money.
At the expense of the cow calf producers.
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Jun 18, 2022 | 08:35
55
At the expense of the cow calf producers.
I'm sorry to tell you that this is nothing new. During BSE the packers and feedlots got the bulk of the subsidies with the thought that it would 'trickle down'. Without us, the actual PRODUCERS of a product that the rest of the chain needs, they have nothing. And it looks like nothing is what they are going to get if things keep going the way they have been. We are price takers, pure and simple. Cattle Commissions are gone (well, I guess there is still the Stockgrowers, but they seem to be more about holding onto their free grass) replaced by Beef Producers. As a cow/calf producer, I produce cattle, not beef.
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Jun 23, 2022 | 06:26
56
As a cow calf producer you are given only 2 options as I see it.
1) Sell your product at a loss.
2) Exit the market.
The dairy industry has announced an increase to cover costs to the base producer.
The Beef industry has announced that they will deduct the added costs of feed and transportation from the base producer. That base producer, who is already paying for the additional costs to his operation, is now expected to pay the costs for the backgrounders and feeders.
There is a point where even with the expected loss of your sunk costs you need to close / exit the business.
Add this years expected losses to the previous accumulated losses I certainly can't afford to be in the cow calf business.
They have already started to "beat the drum" to get fresh blood into the business. Canadian Cattlemen's (et al) propaganda spin down plays the cost of production. If you check out their numbers it's cheaper to keep a cow in Canada than south of I-70 in the USA. I'm going to call Bullshit on that.
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Jun 28, 2022 | 00:37
57
Originally Posted by The Don
As a cow calf producer you are given only 2 options as I see it.
1) Sell your product at a loss.
2) Exit the market.
The dairy industry has announced an increase to cover costs to the base producer.
The Beef industry has announced that they will deduct the added costs of feed and transportation from the base producer. That base producer, who is already paying for the additional costs to his operation, is now expected to pay the costs for the backgrounders and feeders.
There is a point where even with the expected loss of your sunk costs you need to close / exit the business.
Add this years expected losses to the previous accumulated losses I certainly can't afford to be in the cow calf business.
They have already started to "beat the drum" to get fresh blood into the business. Canadian Cattlemen's (et al) propaganda spin down plays the cost of production. If you check out their numbers it's cheaper to keep a cow in Canada than south of I-70 in the USA. I'm going to call Bullshit on that.
Well if you run your operation like the contributors to cattlemen magazine you should make nothing but money like they tell you. Cows can graze through 3 feet of snow and live on hope and prayers.
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Jul 12, 2022 | 06:19
58
Saskatchewan Stock Growers wants the Government (s) to review the pricing practices in the beef industry.
What set of numbers do you think they will use? If they use the usual propaganda numbers they are screwed. If they start to use "real facts" and "actual numbers" they may have to do some explaining.
The US Packing Groups are shipping record amounts of beef into Canada. Allowing the Canadian Processors the ability to further manipulate the markets to their advantage. They have been doing this for a long time.
Canadian Cattleman's Association, now Canadian Cattle Association has known and supported that situation for all that time.
So what is driving SSGA to request a review?
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Jul 12, 2022 | 07:45
59
They sized assets from the Russian oligarchs no problem. Happened quick
What would you call the owners of the Canadian packing industry?
Always more studies.
Always just gets worse for the cow calf guy.
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Jul 30, 2022 | 06:50
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https://www.nfu.ca/wp-content/uploads/2018/05/LivestockreportFINAL.pdf
Something interesting to read for the long weekend.
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