smaller calves to feed over a longer period of time. “The question is, what has to go
on to go forward, because over the last few years, that hasn’t been true,” Peel said. He projected price relation- ships between cattle weights and cost of gain, given a range of corn prices that should trend lower. All these circumstances may lead
In the next 2 to 3
years, the already short supply of
feeder cattle will only get tighter.
to other unusual premiums. “I think there is a good chance that when we get really low with herd expansion, we will see much less discount on heifers relative to steers,” Peel speculated. “You may even see heifers bring premiums this year because the breeding female demand on top of the tremendous de- mand for the feeder animal will be there.” Such strong market signals for more feeder cattle
would typically send producers into high gear to ex- pand their herds and calf crops, but for many American cattlemen today the situation is not that simple. Most producers are more than 62 years old, and at this point in life they are not looking to increase their workload. “When you show a lot of older producers the potential
that is out there from the cow-calf standpoint, they say, ‘Yeah, I see all of that, but it ain’t going to be me. It’s going to be someone else,’” Peel said, but who will that “someone else” be? Getting into the cattle busi- ness is not an easy task. The next generation of cattlemen
cannot borrow enough money to get started, so, Peel said, it is up to the older ranchers to help get them
into the business. He suggested looking at different fi nancial arrangements such as long-term contracts or lease arrangements to transfer equity to the next wave of producers. No matter who takes on the challenge, the fact
remains that the market needs more feeder cattle than are available today. “Now the question is, how far do we need to grow, and how fast can we do it?” Peel said. The Feeding Quality Forums were sponsored by Cer-
tifi ed Angus Beef LLC (CAB), Feedlot magazine, Purina Animal Nutrition, Roto-Mix and Zoetis. More details and coverage are available at
CABpartners.com.
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tscra.org November 2013 The Cattleman 59
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