OT Cow prices

Whats up with cattle prices? I have been seeing a huge drop in them and was wondering what is causing the downward spiral in prices

They are coming down because they were up.

Supply and demand, reduced consumer beef demand caused by or concurrent with increased supplies of cheaper priced pork and chicken. Corn prices affect all livestock production and selling prices but pork and chicken prices are affected before beef because they are fed majority corn rations from birth to slaughter while cattle are raised and back grounded on pasture and forage crops and even in the feedyard the higher priced grains and concentrates are minimized as much as possible. I was taught over 50 years ago that there are two constants required to make money in the cattle business in any market which I have always found to hold true, (1) Grass, if you have plenty of grass your halfway to a profit, (2) sell/buy, buy replacements on the same market you sell finished cattle and the market highs and lows can be managed.

it's the physics of agriculture, when prices go up enough for a decent profit margin their sure to fall to the point of failure

You must be new to farming.Its a cycle prices go up and then prices fall has been that way forever I guess.Still every time prices go either up or down there is always a group of folks that swear they'll never change because "Its different this time".

Prices were higher than they really should have been for a long time. Markets correct themselves over time. Bad to the seller, good for the buyer. But don't expect retail prices to drop.

(quoted from post at 08:22:11 10/18/15)

Prices were higher than they really should have been for a long time. Markets correct themselves over time. Bad to the seller, good for the buyer. But don't expect retail prices to drop.

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I agree retail prices of beef will be much slower to drop than increase very similar to gasoline & engine/hyd oils.

Exactly. I heard a report last week or so that the feed lots filled up much faster than expected after the drought. They said on that report that cattle prices would start to go down but don't expect to see a change in the supermarkets. Its like gas, once it's up it will stay there.

The local grocery store has chicken quarters advertised for $.29/lb when purchased in a 10 lb bag. So you get 10 lb bag of chicken quarters for $2.90. (And it's good too. We've had some) My brother raises steak and when we need a half of beef, I'll buy one from him. And I like steak as much as anybody, as a matter-of-fact, I had a steak for supper last night. But I can whip myself up a pretty good meal with chicken and with two kids in college and another starting college next year, I'm not going to be eating beef at every meal.
I've got two neighbors who work in the livestock barn and they warned me about the drop in beef prices several months ago. It's just a natural cycle.

Yes, just like gas. That is the thing I always find funny when they say it is supply and demand but it never comes down in the store. That isn't true supply and demand is it...

Laa and the others have the cause and effect of the price drop.

I will disagree some on the retail price not falling. We deliberately ran our freezer empty to clean it out. So we have been buying some cuts/type of beef for the last few weeks. I can buy 90% lean beef for $2.39 per pound in 10 LBS. tubes or give $2.49 in smaller packages. This is at Fareway Foods a regional store chain. This price is half of what it was bringing in July. Other competing meats are driving a lot of the price reduction. I can by boneless chicken breasts for $1.69 per lbs. or boneless pork loin for $1.49 per lbs.

Beef prices at the retail sale price needed to come down. If they had stayed high we would have lost market share to pork and chicken. Once consumers switch they are hard to get back. We did this in the late 1970s and it took years to gain much in the per person consumption of beef.

The reality of beef production is that it is a mature market and therefore margins are going to be tight over the long haul. You will have short periods of higher profits but they usually are followed with periods of loses. So those that do not spend the profits like drunken sailors usually survive for the long haul.

LAA hit part of it in that he stated he needs to have plenty of grass to stay profitable. It is more you need to maximize your ground's yield in the crop it will produce the most profit from. It sounds like for his ground that is grass production. For the majority of my ground that crop is corn production. The marginal ground will raise grass more profitable but the better crop land the crop is corn for my area.

I agree for the most part, but a lot of factors drive beef prices, such as a stronger dollar may be hurting exports, feedlots had to be sinking under the weight of $3 calves, higher cattle numbers, less domestic demand because of prices, but as was said before cattle prices go up and down and if you have to have big money for your calves every year to stay in you will be in trouble at some point.

When chuck roast is $5.79 a pound and pork loin is $1.88 a pound [sliced for free], guess which one I'm buying [and putting the excess in my freezer]. And hamburger at $2.99 a pound when it's on sale? I've nearly been priced out of the beef market. And I don't blame the farmers, either.

^D [Like Climate]

I raise and sell beef but eat deer meat,better for me and even at $3 for a .257 Roberts
shell its still pretty good value(LOL)

I always look at as cattle and corn are the same good ground well raise more cattle same as corn . It depends on management and inputs with rotational grazing your machinery cost are much lower and even if it's grass you don't have to replant every year also grass grows 12 months of the year unlike beans and corn which only uses the ground part of the year