Summer Dog Days are upon Us

August 2015

Hello to all our customers and friends,

       Moisture has been sufficient to maintain some really nice looking fall crops.  Let’s hope there isn’t a repeat of the hailstorm that hit Mitchell County in October of last year.  Cattle prices have slumped about $100.00 per head in the last 30 days.  There are several reasons, factually and speculatively.  In the factual column we have slower exports and the board of trade prices have softened; eventually cash markets follow.  Efforts are presently underway to repeal the COOL program that informs consumers where meat comes from.  Every time this program has been presented, modified, and presented again, Canada and Mexico cry foul and argue it is discriminating and illegal according to trade agreements with the US.  Congress has been handed a study that predicted the cost of implementing the program is cost prohibitive.  Looking over packer kill sheets from our steer test for years, there were at least 50 different category designations an animal could come under.  I find it hard to believe adding “Born, raised and processed in the US” on a label would cost the American consumer an exorbitant amount so as to have a negative return.  I prefer to know where my meat comes from and with major packers now in the hands of foreign ownership, I think there is “tail wagging the dog syndrome” going on.  One possible positive outcome being presented is a legislative bill for voluntary labeling of where a package of beef comes from. That may be better for the small packers that can niche market beef. 

    The grain markets cannot find strength anywhere.  Wheat has skidded down since harvest.  Wheat quality in parts of the state is rendering big discounts for Don, the fungus that produces vomitoxin.  Being docked $1.50/bu or more is not out of the question.  While it is a potential covered loss under crop insurance, the feeling of pride in producing a good quality product is much more satisfying. Corn has dropped after a brief upward run during wheat harvest.  Beans shot up $1.00 with the corn rally over the last month only to stall out and drop back $.50 / bu, but are still $.50 higher than last month.

    The cattle on feed report came out today and there are cattle everywhere.  I don’t understand how that many cattle can be recognized when we are at a 50 year low in cow numbers.  Cattle on feed are up 2%, cow numbers are up 3%, and replacement heifers are up 7%.  How can that be??  Maybe you are allowed to count them more than once.  Until next month, Myron