Today's workshop

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Caustic Burno
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Re: Today's workshop

Postby Caustic Burno » Sat Apr 18, 2015 8:20 pm

Jo we are getting hit now on slaughter cows prices sliding due to the San Antonio plant closing.
Somebody is going to take the hit for the freight always us.
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Re: Today's workshop

Postby AllForage » Sat Apr 18, 2015 8:38 pm

Been a few posts in the last year asking about getting into cattle. The ones I responded to I said no way at these prices. Someone even posted about seeing more sheep. Quite few guys here said go all in. When prices drop I bet it's gonna get nasty for all niches and sectors. If you are not sustainable at feeder prices no matter your niche then you better rethink some things.

Jabes has to be an optimist, he just got in. Better be frugal bro.....
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Re: Today's workshop

Postby Caustic Burno » Sat Apr 18, 2015 8:39 pm

Jabes0623 wrote:
Caustic Burno wrote:I know this as have being an operator for more than one or two cycles.
People like you make wonder why I even try.


My apologies, I had no idea facts & a well reasoned polite debate against your point of view would hurt your feelings.

Again, I'm not disputing that cattle prices will go down. There's no doubt that they will. However saying in 5 years they'll be down 33% is nothing more than a guess. They may be up 33%, we just don't know. And we won't until we get there.

Guess I'm an optimist.


You don't owe me an apology it is the other way around.
I was being an a$$ at the time something else had me wired at the moment.
No excuse I apologize.

Edit I should have said a bigger a$$ than I normally am.
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Re: Today's workshop

Postby bball » Sat Apr 18, 2015 9:01 pm

If you are not sustainable at feeder prices no matter your niche then you better rethink some things.

pretty solid advice there. I kinda feel bad for the folks who got into this recently. As stated earlier, pretty easy to run things with these prices. I hope they're prepared to manage things when prices aren't so great, that will sure make a fella creative. Not trying to be a negative nellie, just being a REALIST; beef prices will fall. I have only been at this since 1998, and I have seen the fluctuations (never a peak like this of course) but this crazy peak high price thing will only make the fall that much more damaging, especially if you have never had to take cows to the barn when prices are in the outhouse instead of the penthouse.
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Re: Today's workshop

Postby bball » Sat Apr 18, 2015 9:03 pm

The previous quote was from Allforage. I must deleted something.
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Re: Today's workshop

Postby Caustic Burno » Sat Apr 18, 2015 9:15 pm

I am not trying to be negative either.
Just been doing this for nearly a half century.
This high is artificial and you can take that to the bank
As far as quality of production goes that has been a sticking point for me for years.
You have to stay in the herd or ahead not to be eaten.
I am old and going if the young and growing want to continue in this business
back forty cattle aint going to cut it.
Been a good thread about reality and the trip we are on back to it.
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Re: Today's workshop

Postby Brute 23 » Sat Apr 18, 2015 10:15 pm

bball wrote:
JSCATTLE wrote:I don't see how anyone can make a 3000 dollar cow pencil out. I need about 30 head but I think I'll wait until the price falls out and buy some of those slightly used 3000 dollar cows for 800 when people sell out .


AMEN! I had 3 different people approach me just this past week to tell me they were getting into cattle NOW. While bottle calfs are 500 and heifers are 3000, presuming you could find them..very little margin (if any) at those buy in prices..on top of all the startup expenses, fencing, handling facilities, etc. Etc. They see the end dollar, not the beginning dollar. Like most things, you make your money when you buy, not when you sell...


This happens all the time in many markets. This exact thing that is going on in cattle just played out in another market called the Eagle Ford Shale. $3000 heifers pay out if your sell $3000 heifers off them.

With the Eagle Ford if you owned a bunch of Edwards wells like Pioneer and the Eagle Ford kicked off you were T-ed up ready to go. Same thing with cattle. If you had a bunch of paid for Mommas when cattle prices shot up your were in the right place at the right time. :banana:

Now all these O&G companies that tried to buy Eagle Ford acreage after the fact for $1, 2, 3K+ dollars per acre banking on that $100 oil are taking a beating.

The exact cycle will happen with cattle when we drop back to normal prices. Every one who bought those $3000 heifers after the fact are going to be in bad shape when calves are $600 each again.
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Re: Today's workshop

Postby Brute 23 » Sat Apr 18, 2015 10:24 pm

Jabes0623 wrote:
Caustic Burno wrote:I know this as have being an operator for more than one or two cycles.
People like you make wonder why I even try.


My apologies, I had no idea facts & a well reasoned polite debate against your point of view would hurt your feelings.

Again, I'm not disputing that cattle prices will go down. There's no doubt that they will. However saying in 5 years they'll be down 33% is nothing more than a guess. They may be up 33%, we just don't know. And we won't until we get there.

Guess I'm an optimist.


Its not really a guess. When you trend all the factors like demand, the economy, supply, ect they can see what is an ideal balance. When certain factors start to get outside of the tolerance they can predict a correction. The market ALWAYS corrects itself to find balance.
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Re: Today's workshop

Postby HDRider » Sun Apr 19, 2015 7:33 am

OK - First, thanks CB for starting this discussion, and thanks to all that added to it (that is what makes it valuable).

Second, I understand the 10 year cycle, and I understand it has been disrupted over the last few years. All VERY confusing. I think we all expect, and maybe fear a correction.

Fear fits me pretty good. I want to start raising beef, but I don't want to blow my life savings doing it.

Maybe it is nothing but shear stupidity on my part to even want to get into the cattle business, but I do.
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Re: Today's workshop

Postby Rafter S » Sun Apr 19, 2015 7:43 am

[quote="HDRider"
Maybe it is nothing but shear stupidity on my part to even want to get into the cattle business, but I do.[/quote]

It's not stupid to want to get into the cattle business, but I would suggest that it's probably not the right time.
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Re: Today's workshop

Postby Caustic Burno » Sun Apr 19, 2015 7:44 am

HDRider wrote:OK - First, thanks CB for starting this discussion, and thanks to all that added to it (that is what makes it valuable).

Second, I understand the 10 year cycle, and I understand it has been disrupted over the last few years. All VERY confusing. I think we all expect, and maybe fear a correction.

Fear fits me pretty good. I want to start raising beef, but I don't want to blow my life savings doing it.

Maybe it is nothing but shear stupidity on my part to even want to get into the cattle business, but I do.


I think you can get in just have to be extremely selective on the cow.
Yesterday I blew it on a three Beefmaster bred heifers for 2000 each. IMO you can still
make money with that cow in the down cycle.
You are not going to make it buying LH's Dexters or some other breed that should have went the
way of the dinosaur when premium calves return back 200 to 250 a 100 on 4wts selling through the barn.
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Re: Today's workshop

Postby Bigfoot » Sun Apr 19, 2015 9:21 am

Like everybody, I know they will go down, and I'm not looking forward to it. Has anybody figured the break even point on a 550 pound weaned calf. It's up there these days. Luckily fuel, and grain are cheap at the moment. My other inputs are not though.
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Re: Today's workshop

Postby greybeard » Sun Apr 19, 2015 10:12 am

One of the unknowns that set the current price /\ in motion was the droughts of 2010-2011-2012-2013-2014 (depending where you were located). That 2011-2012 sell off really decimated the national herd size. Those droughts were unpredicted, and the best scientific minds readily admit they cannot come anywhere close to accurately predicting drought. (a few nutcase global warming chicken little types excepted--and even they didn't do any beforehand predicting--just claimed after the fact the global warming caused the drought periods) :roll:

As reported in the journal Nature, Columbia University’s Lamont-Doherty Earth Observatory ran tests to determine whether a state-of-the-art climate model could simulate the droughts known to have occurred in the southwest United States during the past thousand years. The model incorporated “realistic” numbers for factors that affect temperature and rainfall, such as atmospheric carbon dioxide levels, changes in solar radiation and ash from volcanic eruptions. It even included changes in the El Niño/Southern Oscillation (ENSO), a recurring temperature anomaly in the tropical Pacific Ocean that is known to affect weather in the western US and other parts of the world.

Sloan Coats and his colleagues then compared the results of its simulations with data from the North American Drought Atlas. The NADA is a detailed history of droughts based on the thickness of tree rings. According to the Nature article:

The results were puzzling. Although the simulation produced a number of pronounced droughts lasting several decades each, these did not match the timing of known megadroughts. In fact, drought occurrences were no more in agreement when the model was fed realistic values for variables that influence rainfall than when it ran control simulations in which the values were unrealistically held constant.


In May, the U.S. Agriculture Department predicted a record corn yield after farmers planted the largest area of corn and soybeans since 1937. Three months later, after a searing drought engulfed a wide swath of the continental U.S., those crops lie in ruin.

Despite all of the resources at forecasters’ disposal, the worst drought to strike the U.S. in nearly 50 years came on largely without warning across the fields of the Midwest and High Plains during late spring and early summer. Between May 1 and July 24, the drought footprint in the lower 48 states expanded from an already high 38 percent to a devastating 64 percent, engulfing more than a dozen states in the process, including nearly the entire corn and soybean growing region. Judging by past droughts, the drought of 2012 will likely cost the U.S. somewhere on the order of tens of billions of dollars. Despite major advances in seasonal climate forecasting during the past several decades, the failure to predict the scope and severity of the 2012 drought demonstrates that such forecasts are still rife with uncertainty, as forecasters must wrestle with the significant blind spots in their own understanding of the climate system and computer model simulations of that system.


Since last March, forecasters have said an El Nino was on the way. The only trouble is, it hasn’t arrived. Call it the period of the phantom El Nino, a shimmering siren of weather patterns yet to come that has been seen fluttering in the sparkling waters of the equatorial Pacific Ocean.
While every El Nino sparks research, this one -- or the lack thereof -- is certain to prompt even more. Part of the reason is that while some global weather patterns reacted as though an El Nino was taking place, the main characteristics of the phenomenon never materialized. If there’s anything scientists hate, it’s not understanding why something happened.
``One thing that stands out on this ENSO is how wrong the models were in predicting a major event in 2014,’’ said Matt Rogers, president of Commodity Weather Group LLC in Bethesda, Maryland.


scientists-admit-they-cannot-predict-drought
global-warming-not-responsible-for-current-or past-droughts

lack-of-ability to forecast warning-on-2012-midwest-drought-resulted-in-record-planting-and record-corn-crop-failure

Scientists- puzzled-over-failed-2013-2014-El Nino-prediction
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Re: Today's workshop

Postby 1982vett » Sun Apr 19, 2015 10:55 am

Bigfoot wrote:Like everybody, I know they will go down, and I'm not looking forward to it. Has anybody figured the break even point on a 550 pound weaned calf. It's up there these days. Luckily fuel, and grain are cheap at the moment. My other inputs are not though.


I figured mine earlier in the year in the Gross Sales /Net profit Regional thread....

Re: Gross Sales /Net profit Regional
Postby 1982vett » Mon Jan 26, 2015 6:11 pm

Seed - 1141.84
Fertilizer - 4522.00
Feed - 487.1
--------------------------
Total - $6150.94 / 43 Calves is $143.04 with an average weaning weight of 523.10 lbs ..... now throw in fuel, insurance, depreciation, truck (Schedule F)...... that comes to $645.62 per weaned calf.... but that's just last year for me.

Don't know how that stacks up against others, but I'm fine with it. Hope this year is as good.

If calculations are correct....186 days to get their.
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Re: Today's workshop

Postby bball » Sun Apr 19, 2015 11:16 am

HDRider wrote:OK - First, thanks CB for starting this discussion, and thanks to all that added to it (that is what makes it valuable).

Second, I understand the 10 year cycle, and I understand it has been disrupted over the last few years. All VERY confusing. I think we all expect, and maybe fear a correction.

Fear fits me pretty good. I want to start raising beef, but I don't want to blow my life savings doing it.

Maybe it is nothing but shear stupidity on my part to even want to get into the cattle business, but I do.



I love cattle and would never discourage anyone..but timing IS everything... CB gave some very sound advice earlier in post..paraphrase: buy when you can get a great DEAL on quality cattle, if it's not a great deal, sit on those hands. I will say it again because everything in my life has showed me this : you make your money when you buy, not when you sell. I don't care what it is, if you do this, you won't take a beating. DO NOT buy in when prices are at record high, buy in when there are deals to be had..Trust me, they are coming too... Now if you can get a good deal on a few head, I would jump on them (not insulting your intelligence, I'm sure you know this already) but here around me currently 2500$ for a bred heifer is a deal...but not one I can make money with because she will be a Finacial bleeder for a long long time, unless cattle go even higher (not likely). :2cents:
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