Cowchip - March 10, 2017

Andrew Granger  |  3/14/2017 2:50:31 PM

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COWCHIP

DATES TO REMEMBER:

March

18 Acadiana Cattle Producers Field Day, 8:30 a.m., Iberia Research Station, Jeanerette (see flyer)

25 Louisiana Brahman Association F-1 Heifer Sale, 1:00 p.m., Dominique’s Livestock Market, Opelousas

April

8 Dominique’s Stocker Cow Sale, Opelousas

ACADIANA CATTLE PRODUCERS FIELD DAY:

Our Spring Acadiana Cattle Producers Field Day is scheduled for Saturday, March 18. Lots of interesting and useful topics will be on the agenda. A flyer is enclosed. We hope to see you there.

HAS GESTATION LENGTH CHANGED?

Gestation length, the period of time from conception to calving, is affected by several factors. Bull calves arrive later than heifer calves for cows bred on the same day. Calves born in the fall have shorter gestation lengths than calves born in the spring. There are also breed differences. Some breeds have longer than the average of 283 days and some have shorter gestation lengths. For instance, Brahmans average 292 days while Jerseys average 279 days.

We have been selecting for low birth weight for years now in an attempt to prevent difficult births. There is evidence that this selection pressure has influenced gestation lengths. If a bull sires calves that develop just a few days earlier, it has a huge impact on birth weights. Fetal calves are gaining 1 to 1.5 pounds per day. A gestation length five days shorter than the average would result in a 7 pound birth weight reduction. It seems the two traits are one in the same. By selecting for lower birth weights, you’re selecting for calves that mature faster before birth.

The thing to remember if you’ve been keeping heifers from low birth weight bulls and are breeding them to low birth weight bulls, you might be seeing shorter gestation lengths and may even need to turn bulls in later to maintain your desired calving time.

MARKETS AND OPPORTUNITIES:

While volatile down trending market conditions have been with us for the past couple of years, we may be seeing a more predictable market phase. We would all rather higher markets but predictability allows for better marketing decisions.

The fundamentals point to decreased prices for probably the next two years:

• The largest cow herd since 2010 at 31.2 million head

• Beef supplies increased 6% in 2016 and predictions call for another 5% increase in 2017

• Pork and poultry supplies are up as well

How low cattle will go is debatable; 2017 predictions call for average fed cattle prices at $1.07 with lower prices late in the year and fall calf prices being $1.20. Our local fall calf prices could be significantly lower. On face value this is bad news but it also means opportunity. Stockering calves over the winter or retaining ownership through the feedlot are options that should generate profits. The low prices that should be seen this fall will provide opportunity to purchase weanling heifers at reasonable prices.

When these alternative marketing opportunities are considered, pay close attention to costs of gain, futures markets and marketing methods. Use of byproduct feeds and ryegrass baleage have been used to lower the costs of gain before ryegrass is available for grazing in stocker programs. If retained ownership is being considered one should shop around before deciding on a feedlot and knowledge of your cattle’s genetics for growth is required to make good decisions. If you’re thinking about selling your cattle differently this fall give me a call at 898-4335 so we can discuss options.

With a more stable market we should see seasonal price patterns with lower calf prices in the fall and then higher prices in the spring. To maximize profits, we should consider alternatives to weaning and selling.

MID-SIZED FEEDLOTS EXIT THE INDUSTRY, KATELYN MCCULLOCK FROM IN THE CATTLE MARKETS:

February's Cattle on Feed Report provides some unique insight of the previous year's feedlot capacity. The daily livestock report highlighted some of the key points last week. The monthly cattle on feed report provides numbers of those feedlots with 1,000 or more head. However, this represents only 7% of the industry's capacity. There were just over 30,000 feedlots in 2016, and 93% of them held less than 1,000 head. Those 7% however, marketed more than 87% of the total cattle sold.

Smaller sized feedlots did increase capacity adding 2,000 lots (locations) compared to 2015 and increasing the number of head marketed during 2016 by just over 200,000 head year-over-year. This relatively large increase in small feedlots is driven by cheap feed, but is unlikely going to be a long term trend. Over the last decade feedlots with 1,000 head or less have fallen by 65%. The largest increases have been in feedlots with 50,000 head or more, up 28% since 2006.

Larger feedlots continued to add both capacity and numbers, increasing the number of lots with 50,000+ by 2, and the number of head marketed increased by 710,000. The number of head marketed in this largest capacity category represents 34% of the total cattle marketed. The smallest proportions of cattle were marketed in feedlots with 1,000-31,999 head capacity. The number of lots increased in several of these capacity categories: 1,000-1,999, 2,000-3,999, 4,000-7,999, 8,000-15,999 each added 10 new lots last year. Feedlots with 16,000-49,999 lost 12 lots total.

Larger feedlots have an easier time weathering negative margins using economies of scale. But, as we saw in 2016, inexpensive feed/ weak calf prices enticed farmer feeders (<1,000 head) to hold animals and use their own feed. These facilities on farmer feeder operations are fluid and tend to operate when the market conditions are favorable. When conditions are less favorable those facilities remain empty and producers sell calves and corn. Mid-sized operations have less flexibility. In the smaller mid-sized categories, feedlots added capacity as seen in the 1,000-15,999 head capacity groups. In the larger mid-sized categories (16,000-49,999 head capacity), those that could not grow, exited. These categories are never completely stagnant and change as the markets calls for.

Sincerely,

Andrew Granger

County Agent

Vermilion Parish

It is the policy of the Louisiana Cooperative Extension Service that no person shall be subjected to discrimination on the grounds of race, color, national origin, gender, religion, age, or disability.

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