A Day at the Sale Barn

September 22, 2016 01:24 PM

Lower retail prices haven't been able to prop up cattle markets as of late. Despite a rally over the last week, live and feeder cattle futures prices remain below where they were a month ago. October live cattle futures at the CME even dipped below the dollar mark for two sessions earlier in the month.

We vivsted a South Dakota sale barn recently where compared to a year ago, the mood is much different.

It's another day at the sale barn for buyers and sellers at Sioux Falls Regional Livestock. It's an anxious time as live cattle prices have dipped roughly forty dollars since last fall.

"The fat cattle market went down. It started going down and it's declining at a rapid pace now," says a Sioux Falls Regional Livestock owner, David Minor.

Minor says yearling cattle are down 60 to 70 dollars per hundred compared to a yeaer ago. Calves are down 80 to 90 lower. Despite the dip in prices, waiting on better markets isn't always an option.

"When they're ready to go, it's time to go. You can't wait any longer. So, whether it's a good market or poor, you sell," says Hartford, South Dakota producer, Roger Person.

Feedlot operator, Roger Person, is selling Holstein Steers.

"I could have taken another 10 dollars or more. It could have been better. When I bought these, they were rather high. This wasn't a good profit for me," says Person.

Sellers are receiving less money but it's also taking less money to refill pens.

"I'm not going to wait. You make nothing with an empty lot," says Person.

Of course, not everyone has the same strategy.

"Locally, I'm seeing a lot of empty pens. Their pens are empty. A lot of people in this local area will wait for calves also. There are a lot of empty pens already that normally a have some cattle in them," says Minor.

Even though mild weather is good for weight gain, so far feeders aren't pushing as hard, yet.

"If farmers start producing more pounds on these carcasses because of cheap feed, {they will think about} feeding them longer. Well, then these cattle prices which I think have made a low, if carcass weights go up, then we haven't made a low. I'm afraid we're going to go below a hundred then and go down to 90 if carcasses get really large," says DuWayne Bosse with Bolt Marketing LLC.

"We're seeing some cattle get heavy but we're still shorter on weights. They're behind a year ago," says Minor.

However, cheap grain is calling.

"The only good thing is corn. Corn is relatively cheap. You can't afford to sell it so you try to feed as much as you can," says Person.

As another auction wraps, producers know they'll get through the uneasy times soon enough.

"We'll be around and we'll still sell cattle for a long time," says Minor.

Minor says the dairies moving in to South Dakota along with packing plants opening up. He says that will be an asset for that region. 

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