News

Risk of holding calves through the winter

A livestock market analyst says current cattle market conditions indicate farmers might want to think about holding on to calves through the winter.

Scott Brown with the University of Missouri says last week the market suggested it wasn’t interested in lighter weight calves.  “Calves that have been weaned less than 45 days actually sold at a discount relative to a week ago,” he says.  “Yet we got a little price strength in some of the heavier categories.”

He tells Brownfield if producers do decide to hold calves for a longer period of time it shouldn’t be done without managing risk.  “If you do nothing on price risk management just realize you’re fully going to be at the mercy of which way markets move,” he says.  “What looks like a good decision today because of those relative price differences by weight categories, could all go away by the time you sell those heavier weight calves.”

Brown says producers are finding it more difficult to market cattle as the prices decline – and that is cause for concern.  “I just don’t want us to get in the mode of we’re going to wait these markets out until they turn around and go higher again,” he says.  “Unlike corn that we can store for a long time – those calves eventually have to go.”