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Livestock and Forages News Articles
Articles published in Arkansas Cattle Business
Animal Science: Today and Tomorrow - May 2007
Corn Prices and Cattle
USDA estimates 12.2 billion bushels will be harvested this fall, making
2007's crop a record, but that huge supply will still fall 300 million bushels
short of demand. Therefore, 2007 corn crop prices could average $3.60 a bushel
or 40 cents more than 2006's estimated average price.
The ten-year forecast contains some unbelievably low corn stocks carryovers
(the amount of corn left in storage each August 31). For instance, USDA pegs
carryover this year at 935 million bushels or about 30 days' supply. On August
31, 2008, corn carryover will fall to but 19 days' usage. In 2009, carryover
will drop to 18 days; then to just 16 days in 2010.
If USDA is anywhere near correct, stocks-to-use ratios of 5 percent or less
means three things: (1) $3-plus corn will be the price benchmark. USDA sees corn
price averages of $3.50 for 2007, $3.60 for 2008 and $3.75 for 2009; (2) any
planting, production, or harvest hiccup will send feed, food, and fuel prices
skyrocketing at neck-breaking speeds; and (3) Congress should discuss the
possibility of including a modest grain reserve in the 2007 Farm Bill to ensure
domestic supply and stable prices.
The Arkansas Department of Agriculture, Arkansas Cattlemen’s Association, and
the University of Arkansas – Division of Agriculture are currently working to
sponsor a major educational program addressing the corn situation. The program
is scheduled for July 27, 2007, at ACA’s mid-year meeting. More details will be
forthcoming.
Genetic Factors Affecting the Selling Price of Feeder Calves
This article is the fourth of a five-part series discussing the results of an
auction-barn survey conducted from January 1 to December 31, 2005, to determine
the factors that affect feeder cattle prices. Genetically controlled factors
included breed combinations, color, and USDA frame and muscle scores. The
selling price is reported in dollars per cwt and the average selling price at
$118.10 per cwt.
Breeds: Twenty-three breeds or breed types represented 97.7% of the total
feeder cattle. The breeds or breed types were based upon common industry
perception rather than actually knowing the breed composition. Hereford x
Charolais, Angus x Hereford, Angus, Charolais x Limousin, Angus x Limousin, and
Angus x Charolais feeder cattle sold for the highest price and were not
different from each other (Table 1). Only seven cattle breeds or breed types had
selling prices greater (P < 0.01) than the overall mean.
Breeds or breed types do affect the selling price of feeder cattle. This is
due to the perception by the order buyer as to how different breeds or breed
types perform. The perceptions regarding certain breeds and subsequent
performance may be right or wrong, but they exist. With a high percentage of
feeder cattle sold in livestock auctions weighing less than 550 pounds, the
majority of these cattle are purchased for placement in a backgrounding grazing
program. Backgrounding programs are forage-based, and buyers are looking for the
breeds or breed combinations that perform best under those conditions. Cow-calf
producers should be aware that the breeds or breed types that perform best under
backgrounding programs might not be the breeds or breed types that make good
replacements. Cow-calf producers must be attentive to this and design an
appropriate breeding program.
Table 1. Average Selling Price Based on the Breed of Calf
|
Breed or breed type |
Selling pricea |
|
Hereford x Charolais |
$122.66b |
|
Angus x Hereford |
$121.74b |
|
Angus |
$121.43b |
|
Charolais x Limousin |
$121.33b |
|
Angus x Limousin |
$120.83b, c |
|
Angus x Charolais |
$120.59b, c |
|
Hereford x Brahman x Angus |
$120.01c |
|
Charolais |
$118.12d |
|
Charolais x ¼ Brahman |
$117.91d |
|
Hereford x Limousin |
$117.87d |
|
Brangus |
$117.69d, e |
|
Limousin |
$116.86e |
|
Brahman x other crosses |
$116.62e, f |
|
Angus x Brahman |
$116.15e, f |
|
Limousin x ¼ Brahman |
$115.29f |
|
Hereford x ¼ Brahman |
$114.94f |
|
Hereford x Simmental |
$114.15f, g |
|
Simmental |
$111.91g |
|
Saler |
$110.17g |
|
Brahman |
$108.24h |
|
Hereford |
$107.25h |
|
¼ Brahman x other crosses |
$106.25h |
|
Longhorn |
$89.38i |
a Least-squared mean ±
SE (dollars/100 lb).
b, e ,f, g,….i Least-squared means without a common superscript
differ (P < 0.01).
It was interesting to note that many cattle breeds were very similar in
selling price. For example, the prices received for Hereford x Charolais, Angus
x Hereford, Angus, Charolais x Limousin, Angus x Limousin and Angus x Charolais
calves were not different. This is designated by the common superscript "b."
Color: The color of the calf affected selling price (Table 2).
Yellow-white faced, yellow and black-white faced calves brought a higher selling
price compared to all other calf colors. Spotted or striped calves brought the
lowest price.
Table 2. Average Selling Price Based on the Color of Calf
| Color |
Average (Value/cwt.) |
|
Yellow-White Face |
$120.44a |
|
Yellow |
$120.29a |
|
Black-White Face |
$120.03a |
|
Black |
$119.24b |
|
Gray |
$117.66c |
|
Gray-White Face |
$116.79c, d |
|
White |
$116.01d |
|
Red-White Face |
$114.58e |
|
Red |
$113.92f |
|
Spots or Stripes |
$107.37g |
a, b, c, d,…, h Averages without a common superscript differ (P < 0.01)
Frame Score: Price between large- and medium-frame scores did not differ
but large- and medium-framed cattle sold for a higher selling price than
small-framed cattle. The selling prices for large-, medium-, and small-framed
calves were $118.27, $118.15 and $95.43, respectively.
Muscle Scores: Selling prices for muscle scores 1, 2, 3, and 4 were
$120.45, $111.31, $96.28 and $82.21, respectively. Muscle thickness is an
extremely important factor in pricing cattle, regardless of cattle weight.
Beef cattle producers can greatly influence the selling prices of their
calves. Genetic management includes culling small-framed, light muscled cows;
selecting heavy muscled sires; matching the cows with a bull to produce the type
and color of calf that is desirable, etc.
If you have any questions about managing herd genetics to improve the value
of your calves, contact your local
county
Extension agent.
By: Dr. Keith Lusby and Dr. Tom Troxel
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