[inline_image file=”90ceebf2012ea42ed8c78b19183a4c69.jpg” caption=”Pete Crow”]
Feeder cattle futures were looking for a new high with the September and October contracts last week, rallying up to $154.60 and $154.90 respectively. It looks like one of those years when selling feeder cattle in the fall will pay off rather than selling on the summer videos.
Meanwhile fed cattle were slugging it out with cash trade at $108 last week. There are still plenty of finished fed cattle supplies available to packers and carcass weights are exceeding year-ago levels. Steers are 2 pounds heavier than the five-year average and heifers are 13 pounds heavier than the five-year average.
Aggressive marketing by feeders has kept the market at a level that is $10 higher than many expected it to be at this time. Fed cattle futures would suggest that the fed cattle markets are going to be stronger over the next six months.
Demand for beef has been remarkable, both domestically and internationally. There is no doubt that we’re producing a better beef product as more cattle grade Choice and higher. Expanding incomes around the world is the fuel that is keeping this market going. Beef production is 3 percent higher so far this year. Selling more beef for more money is great.
With much of the country in dryer-than-normal conditions, cattlemen aren’t looking to expand herds. So, I would have to say that herd expansion may be over. It will be interesting to see how the bred heifer market shapes up later this year.
Competing meats may be the only issue that could affect beef prices. Pork production is 3.4 percent higher than a year ago and hogs are relatively cheap due to Chinese tariffs. China’s African swine flu issue seems to be expanding and they are huge pork consumers, utilizing about half the global production. China had an episode with blue ear pig disease in 2007 which caused an 87 percent price increase on pork. Then the government set up a strategic pork reserve to stabilize prices. However, it caused rapid inflation and they fear that the African swine flu could do the same to the consumer price index in China.
The Public Lands Council (PLC) will hold their 50th anniversary meeting and celebration Sept. 26-29 in Park City, UT. If you’re ranching on public lands, this meeting is a must! The PLC is as strong as I have seen it—ever. They can get things done with the land management agencies for the first time in a long time. The acting heads of the BLM, Forest Service, and Fish and Wildlife agencies will all attend this meeting.
It’s encouraging that the feds are suddenly seeing the benefits of livestock grazing to manage the land. We’ve had another year of devastating wildfire and simple logic shows that the fuel loads need to come down. They will only be reduced with logging or grazing. The “let it burn” policy has become too devastating to ignore any longer.
The PLC is working with the agencies to attract and hold on to acceptable range managers, who understand that strict grazing plans may not be the best for the land. Cheatgrass, for instance, needs to be grazed hard and early and may not coincide with a rancher’s turnout date.
They are also working on reforms to the Endangered Species Act and the plan is to get it passed before the end of the year. ESA has become unworkable and recovering species is a long-term project. Many species don’t have recovery plans and then the only thing to do is lock up the habitat so there can be no economic or conservation benefits.
Other areas the PLC is working on is the Wild Free-Roaming Horses and Burros Act of 1971. Just last week they got the Department of Interior to quit doing consent decrees and sue and settle to avoid litigation processes. The Department of Interior figured they were doing 90 sue and settle and consent decrees a week.
Like I said, the PLC has the best staff run by Ethan Lane and the best opportunity with the Trump administration to change 40 years of reckless land policy on the Western federal lands. You need to take this group seriously. The membership is dedicated and working hard and are getting things done for all Western public land ranchers.
Don’t be a free rider on this one—the agencies are ready to change. They know what they have been doing hasn’t worked and the environmental community has lost their way on what sound, long-term land management should be. — PETE CROW
