Jon Angell

Despite the abundance of moisture in The Cattleman’s Advocate trade territory, much of the nation’s cattle country is still experiencing drought conditions. The feature story this month describes some of the results of this. With market signals encouraging heifer retention to increase the nations’ cowherd, lack of favorable growing conditions in major regions of cow country will most likely limit normal herd expansion and extend this cycle of high prices.

The situation favors producers in our readers’ territory; abundant grass growth and high value cattle. The value of the gain has never been worth more. I know from conversations with many customers, some are fearful to participate, while others have expressed guilty admissions that they have never had it so good.

Those fearful make statements that start “I wish I had…,” while the others comment, “I am glad I…”. I believe it’s fine and even good to be cautious, but try not to be fearful. Over time, life seems to favor those with a bias for action. Yes, sometimes what we choose to do won’t work out, but doing nothing hardly ever works. These continue to be interesting times to be living. Enjoy the experience, if you can.

I had a recent conversation with an Illinois cattle producer you may find interesting, that sheds some insight into some current business trends. He had contacted me asking for some input about different sources of Charolais bulls. He had recently leased some additional pasture and was rebuilding a cow herd to utilize his own marginal ground, the additional pasture, and to source some cattle for his confinement feeding barn. I knew him primarily as a fed cattle producer, and like much of our industry, leaned heavily towards black-hided cattle. It, of course, made me curious of his Charolais inquiry, so I reached out and asked.

Yes, he feeds a lot of black, English type cattle, but that is what is so available in his area. A recent trip to his local cattle auction he mentioned buying some good Charolais crossbred steers at basically the same money as the best black hide cattle. When he started feeding cattle, they often “penciled” making their fats weigh 1,300 pounds, then it was 1,400 pounds, then 1,500 pounds. As the feeder cattle price has risen, it has become more important to feed them longer and bigger to make them profitable. He is looking to stretch out his cattle to allow him to make them bigger.

Today, many of his cattle weigh over 1,600 pounds pay weight at the packer as finished steers. The business
economics require more pounds to cover high feeder cattle cost, and as an added benefit, this has helped meet a lot of demand for beef products in the face of short cattle numbers.

The last pen that I closed out was a pen of heifers with a pay weight of 1,515 pounds; I can’t remember ever doing that on heifers.

Feeder cattle have only gotten higher it seems, which means that the break-even price on the majority of these cattle will be insisting on higher finished weights, cheaper feed, or both. Feeder cattle are, as we all know, in relatively short supply and hard to procure — yet another reason encouraging cattle feeders to hold on to what they have a little longer making them bigger yet.

My Illinois friend’s idea for his cow herd was for black and black whiteface females using Charolais bulls in a terminal cross for growth cattle to feed and make big. I like his thought pattern. I think in the same situation, I’d be doing a very similar thing, and it wouldn’t have to be Charolais, but nearly any other of the Continental breeds; Simmental, Limousin, Gelbvieh, etc. These crosses generally will allow for later-maturing and larger fed cattle that aren’t as prone
to producing as many yield grade four and fives.

Now, before I start getting hate mail from my Angus, Hereford and Shorthorn friends, I am talking about any English breeds maybe as a base of the maternal side in most cases as they are readily available. Or, if someone wanted, there would be nothing wrong with going the other way, I knew a producer once that favored a commercial Charolais herd and he used a Red Angus bull and produced great calves.

We have all done a great job increasing the quality of cattle as well as the beef they produce. We are producing more beef per animal at higher quality grades. The down side is that in making them so big, we produce a lot of fat. Many of today’s fed cattle at these finish weights are making an abundance of yield grade four and five cattle. I’ve been told across the State of Nebraska 20% of all fed cattle are being harvested as prime grades.

This is fine if processors can find sources of lean beef to blend to make additional hamburger products. So, the packers import foreign lean beef to blend, as well as bid up at auction the cull cows and bulls. The cow and bull market right now is just as impressive as the feeder cattle at auction.

As a further example of what I am thinking; a Nebraska feedlot owner relays an interesting twist in today’s cattle and beef market. Over a lifetime of feeding cattle, he has become accustomed to sourcing cattle nearly anywhere. He now has on the show list a pen of three loads of Charolais Brahman cross steers out of the state of Louisiana. The surprise is that he has had more buying interest in one pen. All the major and regional packers are expressing interest in this one pen.

Why so much interest in one pen of cattle? I normally wouldn’t think about a pen of Southern swamp type cattle as premium cattle to be aggressively fought over. Since we are making cattle so big now, with so many yield grade four and five, the packers are drowning in fat. Most pens have a high percentage of straight English type cattle in a pen,
because as our Illinois cattle feeder stated earlier, “that’s what is available.” This full pen of Charolais Brahman cross is expected to be majority high quality yield grade ones and twos. So, excess trim will not be an issue to the winning bidder.

The take away point is: the economics of feeding cattle now is going to increase the demand for continental breeds in the mix.

As always, we have several interesting and useful stories that you are going to want to spend some time with. Plan on taking an issue along with you to work in the truck or tractor. I’d like to think reading The Cattleman’s Advocate while fueling a tractor, mixing/grinding feed, or filling a water tank, is twice as productive work time as normal.

Thanks for reading and to all our supporting advertisers, be sure to tell them you saw it in The Cattleman’s Advocate!

Send questions, story ideas, criticism, encouragement to:
Jon Angell
Publisher CA
PO Box C
Centralia MO 65240