Agricultural News
Tonsor Provides 2015 Cattle Outlook
Wed, 10 Dec 2014 16:05:13 CST
It's been quite a ride in 2014 for most of the beef cattle segments from cow-calf sector, to stockers as well as for feedlots, but what about 2015? Can the cattle industry duplicate those results for another year. Kansas State University Livestock and Meat Marketing Assistant Professor Dr. Glynn Tonsor said 2015 will be a good year overall for the beef cattle industry, but some segments will do better than others this next year. Dr. Tonsor anticipates the fundamental story for the cow-calf sector is very similar for 2015 as it was for 2014
"They are the ones producing the calf crop that is in limited supply, that is still going to be the case in 2015," Tonsor said. " We have an improving feed cost situation. I think you are going to have continued support for record level feeder cattle prices and there for cow-calf returns barring some kind of extreme surprise on the cost side."
Radio Oklahoma Network Farm Director Ron Hays featured Tonsor on the Beef Buzz feature. Click or tap on the LISTEN BAR below to listen to today's Beef Buzz.
For the margin operators, like stockers Tonsor isn't as optimistic. He looks for historically high values of gain, thus improving the cost of gain situation which is attractive. He said this segment will also require a unprecedented amount of capital with record cattle prices. From a return on investment perspective, Tonsor looks for returns to be better than years in the past, but it may not be as good as 2014, so he encourages producers to watch their margins because of the amount of money tied up in cattle.
In looking at the feedlot end of the business, the scenario does not look rosy for 2015. Tonsor said he is most concerned about feedlot returns because too much bunk space and the limited size of the calf crop will have to get worse before it gets better. He said with producers holding back more heifers back to expand the cow herd he gets concerned that will squeeze margins further. Tonsor said the odds that 2015 would be as good as 2014 are very low for the feedlot sector because of the very higher feeder cattle prices.
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