Feedlots Making Money Now- Stocker Margins are Tough- Derrell Peel on Current Cattle Market Profit OutlookThu, 02 Mar 2017 10:18:11 CST
Feedlots are making money right now while stocker operators are having a hard time penciling out a chance for profit- so says Oklahoma State University Extension Livestock Market Economist Dr. Derrell Peel. Peel offers Radio Oklahoma Ag Network Farm Director Ron Hays his thoughts on the current ability of each segment of the beef cattle pipeline to make a profit here in the early days of 2017 on today's Beef Buzz.
Peel says that "feedlots have seen the best margins they have enjoyed in quite some time" but that looking ahead the challenges will mount given the discount that the futures market has placed on finished cattle prices. The Economist believes that cow calf operators can make money- but they must be proactive in managing costs very carefully going forward. Peel tells Hays that one area of cost containment for the Cow- Calf producer is to minimize the feeding of hay when possible- getting that cow to harvest the forage in your fields for you as many days of the year as possible.
As for the Stocker producer- Dr. Peel says "the sector that may get the squeeze from here on the hardest is the stocker sector. There have been opportunities through the winter (to be profitable) but if you now- it appears the feeder cattle market is fully pricing cheap costs of gains that are out there with the abundant grain supplies and cheap grain prices and so I think there will be more of a squeeze on the value of gains for those stockers."
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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