12-30-22 – Ahh, 2022! It was full of challenges for those in the cattle business, said Mark Johnson, Oklahoma State University Extension beef cattle breeding specialist, in a letter to Extension agents called Cow-Calf Corner.
Drought, high input costs, excessive heat and more drought.
As much as he would like to dismiss and forget the past year, Johnson said there were too many lessons to learn from 2022 that can make producers better at the cattle business in the future to just dismiss.
If the past year did not test the resilience and resourcefulness of cattle producers, they must not have owned any cattle, he said.
Looking forward to 2023 and the opportunities that lie ahead, Johnson reflected on what can be learned from 2022.
- The cattle business is based on having an available forage base that cattle can graze and turn into beef, he said. The key to profitability is to find a long-term balance of input expenses and production levels. Without grazable forage, finding that balance is next to impossible.
- Prepare for drought when getting normal rainfall, and prepare for normal rainfall while in a drought, Johnson said. Accomplishing this prepares an operation to survive and positions it to capitalize on the opportunities that will present themselves in the form of low cattle inventories that will follow.
- Cattle are adaptive creatures, he said. Although “you can’t starve a profit into a cow” it is amazing what the ruminant digestive system can convert. If a producer is willing to do the math, know cattle’s nutritional needs and be willing to try something new, there are innovative ways to maintain cows.
- Proper culling methods to reduce inventories leave producers with a better cowherd, he said.
- It’s not just the cattle, Johnson said. Producers must remember to care for the soil and plants.
- Tough years can make producers better managers if they remember the lessons of 2022, he said. Good markets await those who can manage through the tough times.
Choosing topics to write about in 2022 was easy, Johnson said. “Would it pay to fertilize Bermudagrass?” “Preventing heat stress.” “Culling criteria.” “Early pregnancy checking.” “Would it pay to turn your weaned calves into yearlings with no wheat?”
Johnson may not have been able to provide a silver bullet answer, but he tried to address what producers were dealing with throughout the year and tried to help.
A market analyst added that continuing education about new management or marketing technics or opportunities also may not be a silver bullet for producers, but he urged producers to never stop learning and applying.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $155.46 to $158.70 per cwt, compared with last week’s range of $156.04 to $157.34. FOB dressed steers, and heifers went for $243.77 to $247.35 per cwt, versus $243.79 to $249.01.
The USDA choice cutout Thursday was down $0.55 per cwt at $278.86 while select was up $3.42 at $250.70. The choice/select spread narrowed to $28.16 from $32.13 with 80 loads of fabricated product and 22 loads of trimmings and grinds sold into the spot market.
The USDA said basis bids for corn from feeders in the Southern Plains were steady at $1.90 to $2.10 a bushel over the Mar futures and for southwest Kansas were unchanged at $1.00 over Mar, which settled at $6.79 1/2, down $0.03 1/4.
Six steer contracts were tendered for delivery Thursday.
The CME Feeder Cattle Index for the seven days ended Wednesday was $179.84 per cwt up $3.76. This compares with Thursday’s Jan contract settlement of $183.80, up $0.32.
IN OUR OPINION
–Corn prices may be gearing up for a rally based on fundamentals. The 2022 harvest was less than expected because of drought, and now Argentina planting is behind schedule as growers there wait for meaningful rain. It’s probably a good thing for livestock and poultry producers that ethanol production is slipping while stocks are building. How much will inflation affect the 2923 economy will be a major factor throughout the year.