July marked my first full month on the job as a field representative for the Western Livestock Journal, and what a month it was. I had the opportunity to break into the new role fast by standing ringside at the Northern Livestock Video Auction in Billings, MT, and Superior Livestock Auction in Winnemucca, NV, where between the two sales, over 300,000 head of feeder cattle were marketed.
Many auctioneers I’ve worked with have told me the same thing about livestock sales: a quiet room is never a good sign for a good sale, and hearing that “buzz” in the barn before a sale is always a good sign. The buzz and electricity were undeniable in the rooms at these video auctions. Producers were able to celebrate record-breaking prices this summer, and deservingly so. I even saw a few tears of joy roll down old cowboys’ faces as their cattle marched across the screens. The sentiment when you talked to producers was: “I never thought I’d ever see anything like this.”
The most common question I get asked is “how long will it last?” and “where is the top going to be in this market?” Those questions are hard to answer. I would wager to say that most people didn’t see the market going this much higher this year compared to last year. The recent cow inventory report showed a record-small cow herd with some small signs of a rebuild starting. Traveling down the road across the northern territory it’s been clear: we are short of cows. With my previous role, I had the opportunity to travel north of the border up into Alberta and Saskatchewan, and they are short of cattle as well. The Canadian cow herd is also at its lowest levels since the 1980s. They have also been witnessing record prices on feeder cattle and bred stock, and we have seen that pressure come down to the states. Canadian buyers have been aggressive on feeder cattle to fill their pen space up north of the border.
I personally felt there were some signs of some slow rebuilding starting this spring in Montana and the Dakotas. There was some increased pressure on those replacement-type females in the sale barns and production sales from speculators looking to sell bred heifers this fall, and producers trying to restock with quality cattle. But even so, the heifers bred this summer are still almost 30 months from having their progeny being a fat animal and going into the meat supply. It also seems to me that there has been some increased competition on the replacement-type females being contracted this summer on the video. However, these feeders are still outbidding the replacement buyers in a lot of situations. One thing about a lot of these nice replacement heifers is that a lot of them make very good feeder heifers. It feels like the guys looking to feed these heifers are more confident in what they will be worth as fat cattle in 2026, than the buyers looking to breed them are feeling about how much a bred heifer is going to be worth in fall 2026. If we truly are starting a rebuild situation, I think it is going to be a much slower rebuild than in the past.
When the lighter 300-500-pound cattle came across the screen, it sure seemed like the bidding became aggressive and competitive from a higher number of buyers. It feels like we are continuing to see some of the traditional cow-calf operations transition to running a few more stockers/yearling, instead of taking the risk of reloading with mother cows. With the prices these yearlings have been fetching, it is hard to argue with that strategy.
Many of my closest friends are young ranchers at the growing phase of their operations. They are all enjoying the fruits of this market and taking the opportunity to capitalize on some profitability and looking to reinvest in their operations. However, most of them are apprehensive about diving off and buying another big bunch of cows. The sting of buying cows in 2014 is still on their minds. Many of these young producers are taking a slower strategy to rebuilding and waiting for interest rates to drop further before they take some big risks.
It has been a fun summer watching producers get rewarded and records get broken at all these markets. I believe this market still has some legs underneath it, and will continue to stay strong for the producers. Enjoy it, and don’t apologize for it. — KEVIN MURNIN
