Mystery Lurks as Seasonal Lows in Cull Cow Market Arrive Early- LMIC’s Jim Robb Offers This AdviceThu, 13 Sep 2018 11:00:37 CDT
In recent days, cull cow markets have taken on a significant amount of weakness in profitability. Jim Robb of the Livestock Marketing Information Center says this annual weakness has appeared much earlier in the year than it typically does generally around the 4th Quarter.
“It seems like a complicated story and one we’re trying to get our arms around to be honest. If we look on a national basis - in August, we had a pretty big drop down on a carcass basis from $122 to about $116,” he said. “That’s a very strong drop and one that’s come much earlier than normal.”
Year-over-year, cull cow markets are down by approximately 19 percent. That is in contrast to the meat market that is behind the cull market, which is only down about 7 percent. The price reduction for cull cows is especially impacting the Southern Plains which generally runs about 5 percent below the national basis. Currently, though, it is 17 percent below the national average. Robb says the effects of widespread drought in the region probably accounts for much of that. Although still from a very low position, Robb says the good news is that prices have seemed to stabilize over the past few weeks. He believes markets will begin to rebound once the bulk of the peak numbers of culled cows now entering the pipeline can be processed. In anticipation of an eventual seasonal rally at the end of this period, Robb advises producers with available feed resources to consider holding on to any culls they might have and continue to put some added weight on them before selling them to take advantage of prices down the road.
“So, this is a little bit harder of a puzzle to put together. We think it’s partly because of the larger slaughter levels,” he said. “So, much of it is just the supply as we have a lot of drought areas in the US and maybe a little bit earlier culling due to Mother Nature and grass conditions, etc.”
Listen to Robb’s analysis of the current cull cow market and what advice he offers to get top dollar for your culls, with Radio Oklahoma Ag Network Farm Director Ron Hays, on today’s Beef Buzz.
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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