OMS Article by Port City Stockyards in Sealy, Texas (979) 885-3526

J.D. Sartwelle, Jr., President of Port City, for many years has written his "Over My Shoulder" articles that are a "marketman" in cow-calf country perspective on why our markets of the previously ended month behaved as they did. The article is published in several livestock trade magazines and in many country newspapers.

December Over My Shoulder
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September Over My Shoulder

Did September signal the end to the long, hot, dry summer? It just seemed like another in a long line of miserable months. During the month, there did seem to be some slight shifts in the weather pattern that resulted in lower temperature and some rain makers particularly during the last half of the month. For the most part through, September was hot and dry and did not change things for many folks or areas. The national political scene was dominated by the Republicans with their debates and additions to their ranks. The President presented his jobs bill to the joint congress and then began to sell it across the country. The congress did go back to work as did the bureaucrats as they promulgated new laws and regulations in several areas while the USDA made one more adjustment to the available corn supplies and found another whopping 1.5 billion bushels. The livestock scene saw continued forced movements of cows and calves in the Texas, Oklahoma, and New Mexico area while other areas saw more orderly and seasonal movements. By some folks estimates, by the end of September, Texas and Oklahoma could be down nearly 50% of their cows with not many more calves to sell from the 2011 calf crop. September was the fourth month in a row that saw abnormal numbers of cattle at markets.

The livestock marketing sector of our industry deserves much credit for handling, selling, and merchandising these increased numbers. Slaughter cows were harvested in Texas and California, the mid-west, the southeast while the stocker cows in the mix went many directions to far- away places. They didn’t just do it for a week or a month, they did it all summer long. Texas and Oklahoma market-men rose to the occasion and sold cattle for more money than could be expected in a sell off mode. Market men, order buyers, yard hands, truckers, slaughter facilities, hay folks, all deserve a lot of credit in getting the job done. Think about it, if you haven’t already.

As grass conditions did not improve during the month and as fall grazing prospects dimmed, many folks began sending cattle out of state; southern cattle went to Louisiana and the southeast, North Texas and panhandle cattle went north while others went to Kansas and Missouri and other places. Cattle went out of state while hay came in from every direction. If we haven’t learned much in the past couple of years, we have learned how to haul a round bale in numbers.

On the national scene, when the Congress returned to work after Labor Day, the President made his job bill known and started telling the country about it. In the meantime the USDA extended the dead-line in Texas for Emergency haying of CRP acres in Texas. USDA, at the end of the month, found another 1.5 billion bushels of available corn and this coupled with pending legislation that could do away with the Renewable Fuel’s mandates of ethanol production and use, and be tied to the corn supply, could hold the price of corn down to levels not recently seen. The Department of Labor proposed new Child Labor Rules for the first time in forty years. Agriculture will be dramatically affected. Early month, the Senate went back to work and pass the Trade Adjustment Assistance act as hopefully a prelude to approving the free trade pacts that have been on the President’s desk since late May. It’s called jobs.

In the feedyards, fed cattle prices that began the month at $113.00 sold well and ended the month with a top of $121.00/cwt. The fed trade was bolstered throughout the month with a continued robust export trade that now accounts for over 10% of total production and a brisk trade on fifty-fifty trimmings.

At the markets, large numbers of stocker cows and slaughter cows came to town and were sold into the appropriate channels. The backlog of slaughter cows caused by kill capacity and transportation meant that some cows were not harvested for several days. Price levels eroded to a lower level as the better cows that could hold and travel traded into the low sixties and scaled down to the weak cows trading in the low thirties. The calf trade was also affected by numbers, but also because of the typical September health scenario of warm days, cool nights, and plenty of dust at home and elsewhere. September calves just get sicker than any other month. The heavy weight calves sold better than the light weights and among the light weights, the steers were in much more demand than the heifers. The heavier weight steer calves sold up to middle dollar thirties, the middle weight calves sold to the dollar fifties, while to light weights sold up to a dollar seventy.

The pork complex fared well with their export trade being their under pinning and should do even better with lower corn prices as should the sick poultry boys.

Fall is here and it sure would be nice to get enough rain to get some planted green grazing up or enough to plant on. Come on turn-a-round.

END

August Over My Shoulder

August has come and gone and was only a repeat of the previous months. Hot and dry over a very large area of cow country, wet over a large area of the farm belt to the east coast, more moderate temperatures and moisture in most of the south. The congress was on vacation and not a lot was heard from Washington while potential presidential candidates either got in the race or got out while the economy changed little.

Record setting high temperatures for the entire month was seen in many places of Texas and Oklahoma with no rain until the end of the month when a few active areas sprang up and rained, albeit not very often in the same spot. By end of month most of the weather activity in the north went all the way to the east coast where record rainfall for the month of August was recorded just before Hurricane Irene added much more to it. Livestock and grain markets behaved about like they have since early summer, ie, rising and falling on the news of the day but being somewhat oblivious to the spikes of the stock markets not only in the U.S. but the major exchanges in the world. In the meantime the hot, dry miserable conditions of a typical August coupled with the same hot, dry miserable conditions of the on-going drought forced sell off conditions on many who had simply run their course and had to holler calf rope. Forage conditions and stock water became non-existent for many folks as unseasonable numbers went to markets throughout the month. For those trying to hang-in, their farmer neighbors began baling corn and milo stubble as well as rice stubble and enlisting any truck they could to do the hauling. Hay went every direction throughout the month at relatively high prices.

In the feedlots with the news that July placements were some 22 percent ahead of last year it was apparent that grazing conditions for the earlier weaned calves of June and July had few homes outside of the feedyards or grow-yards and were placed on feed. The fat ready cattle numbers were slightly ahead of last year’s numbers and sold firm-higher throughout the month. The first week of the month saw a whopping $4.00/cwt increase to a top of $113.50 that rose to a top of $116.00 to end the month about where it all started at the $113 for a top. The market was well supported by cutout values, the futures, and export demand throughout the month.

At the markets, stepped up numbers of calves of all sizes and weight came to town in large numbers and their mothers came with them. The calf trade held up surprising well with the little cattle tailing off more than the larger calves. The cow trade held up also as cows were shipped in all directions either to the packing house or pastures to the north and east.

Out of Washington and USDA came the proposed Rules on Disease Traceability that the industry has been waiting on. Industry groups are studying and preparing their thoughts on the proposed rules. USDA also revised their corn crop predictions and will probably revise it umpteen more times before harvest in complete. The other big ticket item out of the capitol is the free trade agreements that the President says he intends to present to congress in September. We heard that in June also. In Texas, you will keep hearing about our own brand re-registration within our counties to begin August 29 and run through February 29, 2012. Put it in your job jars and don’t forget.

A change in weather would be welcomed and is sorely needed if we are to continue surviving the miserable weather conditions that we are facing. A cooler fall with more moisture might even grow some fall weeds, maybe some rye grass or wheat or oats and later on a little clover. Every dry spell comes to an end with one rain, then two, then three; it can start with the new month and not hurt anyone’s feelings that I know.

END

July Over my Shoulder

During July, relief from the heat and lack of moisture came in only a few places. Those that had been getting moisture continued to get it while the whole country experienced elevated, and in many cases, extreme temperatures during the month. People and livestock suffered as well as crops in various stages where ever they were.

Livestock prices remain relatively strong bolstered by a good export trade while uncertainty with the effects of too much rain, not enough rain, and extreme temperatures on grain and soybean crops kept prices high. Washington was dominated by debt ceiling talk with a little bit of congressional activity concerning agriculture as the month went on.

Weather close to home was the same old six and seven as wide spread changes did not occur; some areas in our own big state did see a little relief in the form of heat showers. If you were lucky enough to get two or three you saw some grass green up and then begin to grow. Areas along the coast into Louisiana and Mississippi seemed to get the most of it as some areas experienced monsoon type rains and went from being somewhat dry to excessively wet.

It seemed that not much went on with the political scene except rhetoric concerning the debt ceiling and it went on and on and on. Early month saw the Senate and the House begin holding hearings on the GIPSA livestock marketing guidelines that have remained controversial. The guidelines have drawn the attention of the House and Senate as an unnecessary intrusion into the marketing of livestock and has had funding withheld for implementation and further work on it. The House and Senate both are holding hearings on the corn based ethanol subsidies program and are making sounds about phasing the program out by eliminating the 45 cents per gallon to ethanol producers and the 54 cent tariff on imported ethanol.

It doesn’t look like any of the three pending free trade agreements will make it to the congress before the summer break. Approval might get sticky as the Administration is still pushing for renewal of the Trade Adjustment Assistance program before presenting the free trade deals with Korea, Columbia and Panama. The U.S. and Mexico reached an agreement to end the ban on Mexican trucks coming into the U.S. under the NAFTA agreement. Mexico agreed to immediately reduce by half the retaliatory tariffs on U.S. imports and end them completely when the first trucks come into the U.S. under U.S. rules.

You said what? The United Egg Producers (UEP) and the Humane Society of the U.S. (HUMUS) entered into an agreement to ask the government for legislation and rules for the purpose of transitioning the industry from primarily a conventional cage-egg production system to an enriched colony-cage housing system over a period of 15-18 years. What did you say? Boys, don’t think for a minute that the “chip away theory is not alive and well. Who’s next.

The mid-year cattle inventory reported was issued late month and indicated that in the face of cow liquidation in Texas, Oklahoma, and New Mexico is reducing the cow herd to 31.4 million head, 99% of last year. Beef heifers held for replacement purposes are 95% of last year while the 2011 calf crop is estimated at 99% of last year.

Looking at the cattle markets and starting with the fed cattle complex which has been bolstered by a robust export trade, fed cattle began the month with a top of $113.00/cwt. The second week of the month put on $2.00 before backing down to a top of $108.50 at end of month. Cut out values seem to go up and down and indicate that the export trade is in stronger hands than domestic demand. It can be fickle also, so we might continue to see a little volatility in the fed deal.

At the markets, calf numbers are un-seasonally larger as well as looking at increased number of cows and bulls being eliminated. Calf prices have remained high while slaughter cow and bulls prices have reflected the strain on kill capacity. Some cows and bulls are going a long way to be harvested. Pricewise, a few thin cows are selling in the thirties, with a straight canner up to the low fifties, while the fleshier cows are selling high fifties into the sixties. The calf trade is still relatively high and mostly unchanged. The pork complex is still looking at slaughter hogs in the seventies.

One more summer month and if this one goes without much rain, we’ll sure nuff see cows continue to come to town. It seems that so far, not even a tropical storm at the end of the month can change our patterns.

END

June Over My Shoulder

June was another month that will become a bad memory that doesn’t need to be repeated. Once again the month was hot and dry with very limited moisture for most in the state. Spring row crops matured, withered, and died as did the grass in many areas. Some areas remained greenish but grew limited amounts of forage for a cow. In the meantime over most of the farm country, too much rain still hampered late planting, while flooding wiped out many acres of grain, and allowed uncertainty to creep into grain markets. Grain markets reflected gross uncertainty as prices shot out the roof before falling backwards. Livestock markets fared well on seasonal markets, while finished cattle and hogs reflected domestic as well as oversea demand. The Texas Legislature finished their special session while the U.S. Congress wrestled with debt ceilings and stalemated for most of the month.

June set temperature records over most of the state as the month really had only one or two periods of rain depending on where you were. The most wide-spread rain maker came during the fourth week of the five week month. With the exception of the northeast portion of the state, the entire state fell into the severe, extreme, or exception categories of drought. That means that Texas is hurting as cowboys started biting the bullet as more and more cows started coming to market; calves were pulled early and sold at lighter weighs that usual. If hay is to be bought it will come from faraway places where competition and freight will make it prohibitive for most to buy. The row crop boys will see limited yields and in many cases will not gather what they have. Dry weather will cost the ag community many billions of dollars just as too much rain and flooding in other areas will cost those folks many billions.

Our special session of the Texas Legislature finished up by agreeing to a budget, and resolved nothing on the sanctuary city situation. Budget problems will force the livestock industry into a cessation of first point testing of cows and bulls at our market. The Texas Animal Health Commission has announced that on August 1, Texas markets will end the testing of test eligible cattle at all markets. Texas is now a Brucellosis Free State and as such would have been eligible to cease testing at some point after being declared Brucellosis Free. This process was speeded up by several months. For most of us in the southern half of the state it would still be wise to continue vaccinating replacement females for several years to come. TAHC also released Maverick and Dimmit counties from the Fever Tick Temporary Quarantine Zone during the month.

On the national scene, the every other year, 2011 National Beef Quality Audit will shortly be under way. The audit is conducted by Colorado State University and Texas A & M. New for this audit will be questionnaires submitted by cow-calf producers. Out of Washington, the House Appropriations committee defunded GIPSA’s proposed livestock and poultry marketing regulations that have been so controversial in the last year. The Senate adopted amendments to a bill to eliminate ethanol subsidies and import tariffs. It has been reported that the 30 year old ethanol program has cost the US 30 billion dollars in direct subsidies.

In the feedyards, from first of month to last, fed cattle added eight and half bucks while ready numbers were tight and demand improving. Fed cattle ended the month at a $113.00 top. May placement numbers in the feedyards were larger than last year and was reflective of dry weather forcing cattle into the yards.

At the markets, larger than usual numbers of cows and calves came to town. As the lack of rain, something to eat and the high June temperatures became the reality, cowboys divested themselves of cows and light weight calves. The better cows sold into the sixties and low seventies, the bulls into the eighties. The calf market was lower in the face of more numbers but still high. With today’s market prices it makes it an easier decision to cut back or eliminate or sell a calf early.

The pork complex remained in strong hand as the domestic and export traded treated them pretty well also. Most of the top weight barrow and gilts trade in the low to mid seventies on a live weight basis.

A turn around in the weather would be a welcomed respite to what it has been. It doesn’t usually do it in July, but it could. A good many areas could respond should we start some moisture giving weather patterns. It wouldn‘t hurt if the extreme temperatures would not be quite so hot.

May Over My Shoulder

May was just one more month punctuated with weather extremes all over the country. Too much rain, too little rain, temperatures too cool, extreme conditions producing violent weather, and too hot too early in many areas. The weather played havoc with production agriculture and with urban as well as rural areas of the country. Excessive rains, no rains, tornadoes, and massive flooding, all took their toll on the people of our land. In the meantime, life went on in the unaffected areas of the country and in other parts of the world where the turmoil continued as usual.

Abnormal spring weather that continued through May dramatically affected livestock and crops. Some late May rain activity in some areas of our state has been enough to keep some areas out of the woods but still needing continuing moisture. The late rains were too late for many cattle that were to be grazed through May as they were pulled early and entered feed-yards prematurely. There will be limited summer grazing for many of the cattle that will come to town early as the cow calf sector eliminates cows and sells calves early. Stock water and water levels will become a real problem when the summer sun and heat take its toll as the days lengthen.

Early planted corn and milo will never have a chance in most areas as it has matured early and done nothing just as the winter wheat made little grain. Corn plantings in the Midwest were far behind their usual pace due to excessive moisture, cool temperatures, and flooding of an estimated 3.6 million acres of land; the experts say that Arkansas, followed by Illinois, Tennessee, Missouri, Mississippi, and Louisiana comprise the bulk of the acreage.

Ag markets didn’t know which way to jump; some fell lower while others jumped up. Fed cattle worked lower throughout the month partially due to cooler weather holding up the grilling season, while feeder cattle prices reflected increased volumes and grain prices that some thought would send corn up to the $8.00 mark.

Gasoline and diesel fuel didn’t know what to do at first of month before easing off a little as fears of flooding on the lower Mississippi seemed to be abated when flood control measures took the pressure off of down river refineries and activities.

On the political front in Texas, the Legislature ended its every other year term with unfinished business that caused the Governor to call a special session to consider budget, school, and redistricting efforts. Other happenings in Texas saw the Animal Health Commission release some 59,000 acres from the Temporary Fever Tick Quarantine Zone in Starr County. The preventative quarantine was established in 2009. In Texas, the USDA authorized the emergency grazing of CRP acres in 13 counties in Texas which now makes 51 total counties.

In Washington, ag industry participants once again petitioned those in government to call for and approve three pending free trade agreements, ie, South Korea, Columbia, and Panama. On the international scene, at the end of the month, a WTO (World Trade Organization) dispute panel in a preliminary ruling, declared that the U.S. Mandatory Country of Origin Labeling law violates the North American Free Trade Agreement. Canada and Mexico petitioned the WTO for a ruling saying they are discriminated against. In other happenings, 147 members of the house wrote a letter to USDA Secretary Vilsak regarding GIPSA’s proposed rule on livestock and poultry marketing just before the house ag committee in marking the ag budget did not fund further work on the rules.

In the feed yards, fed cattle continued to fall from April highs over the $1.20 level and ended the month with a top of $105.00 as beef did not find support at the retail level. At the markets, continuing dry weather brought more cows and calves to town than usual. It has become an easier decision to cut back on numbers as slaughter cows and grinding beef have remained a favorite on the supper table. Lean cows selling into the sixties and low seventies and bulls into the eighties and low nineties. Calf prices have changed but are still at high levels as we have moved off of spring time highs. The lighter weights are in the upper half of the second dollar while the heavier calves are in the lower part of the second dollar.

June begins yet another month in search of rain over a large area; it’s not always in the cards to get June moisture but it would sure help before most folks have to make monumental decisions.

END

April Over My Shoulder

April was just one more month that started dry, provided very little moisture, and departed dry; that is, in the southwest, across Texas and to the southeast. In other places the rain didn’t know how to stop. During the month, markets saw a little confusion, partially caused by weather, while in Austin and Washington the talk continued.

The real weather news was of the extreme weather conditions that lasted throughout the month. Floods in the northern Mississippi watershed and elsewhere, devastating tornadoes in the Midwest to the Southeast and wildfires in Texas that consumed over two million acres. Dry weather slowed plantings in Texas and too much moisture prevented plantings elsewhere. The scientists say that we are moving into an El Nino condition in the Pacific that should spell a different weather pattern for us in the lower part of the country. Hurry up El Nino or you won’t have anything to salvage.

Texas drought is being felt statewide despite a couple of occasions when it did rain in the north Texas area and east of I-45 towards the end of the month. Groundwater is disappearing rapidly and will fast become a major concern as stock tanks and wells begin to have problems. Continuing dry winds and rising temperatures have and will only exacerbate the extreme dry conditions due to lack of rain and as available grass disappears most livestock folks will began some kind of liquidation program and/or supplemental feeding to hang on as long as possible.

Meanwhile in the halls of government; the legislature in Texas was still trying to budget the next two years without the rainy day fund while we finish off the ground water ownership and eminent domain bills. On the national scene, even more groups and politicians are discussing our ethanol programs. In the house where there is the R majority they have voted favorably on bills to stop EPA from regulating Greenhouse Gases. They might be voting on many more bills that might stop governing by regulation instead of legislation. A very good thing did happen when the President did sign the bill to eliminate the very onerous provisions of the health care bill that dealt with 1099 reporting.

The administration did finish hammering out a free trade agreement with Columbia and has sent it to Congress to ratify. USDA announced a proposal for a “test and hold” requirement on meat and poultry that essentially will reduce the amount of product that is shipped before test results for harmful substances are known. Most in the industry already comply with a similar voluntary program. USDA also announced during the month that they would probably unveil their new proposed Animal Disease Traceability Program and at the same time indicated that if not funded with the new budget processes it might be awhile before it can be implemented.

In the feedyards, available numbers have not changed while dry weather placements are coming into the yards prematurely. The market is seeing some up and down movement due to weather and economic concerns while at the same time seeing an increase in exports particularly to Japan. Cooler, wet weather is delaying the onset of the grilling season which was slowed by a late Easter, while rising retail prices might be forcing some folks to seek alternatives, as well as dining “down” or not at all out of the house. Many are putting gasoline in their cars and not meat in their bellies. But all of this was going on while fed cattle were bringing well over $115.00 all month long.

At our local markets, seasonal numbers increased with both calves and slaughter cows and bulls. Marketings of many of the fall calves were pulled forwarded and sold early as a good many folks went ahead and got tough with their cows when they worked for the spring. Increased numbers put pressure on prices as calves as well as the slaughter cows and bulls backed off a good bit throughout the month. Although the market has lowered it still remains at high levels. If it stays dry, we’ll all be making our own adjustments in numbers.

The pork complex remained in relatively strong hands while not reaching extreme spring highs that might have been expected. The top weights ended the month in the mid to high sixties.

Despite some rain activity during the month, our state remains critically dry with crops and grass as well as top water and underground supplies in need of something from above. Let’s hope that somehow or other, May will bring needed moisture to our parched lands.

March Over My Shoulder

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March started out as a rehash of the previous month; ie, dry with limited moisture, turmoil in the middle east, and then punctuated with the earthquake and tsunami in Japan and their devastating consequences on a large number of the Japanese people.

Our own national life was and is filled with actions in other parts of the world as folks sort out their own lives and piece them back together again.

At home, topsoil moisture was mostly short to very short statewide with crops and pastures in most of the state needing rain; pure unadulterated rain from the heavens above. With a bet on the come, end of month saw two percent of the wheat crop headed and rated as mostly fair to very poor condition. Fifty percent of the corn acreage was planted and 16% had emerged; grain sorghum was 46% complete while 44% of the rice was planted. Plantings were ahead of the usual normal pace but moisture is needed for germination and continued growth. Pastures are in dire need of top and bottom moisture and April showers would be most welcomed.

There was plenty going on in the agriculture scene but it all seemed to be overshadowed by world affairs. Obviously, unrest and turmoil in the middle east will probably lead to regime changes in several and countries is important to us in many ways as we focus on it in the news and by our national leadership.

We did think a little about ag when throughout the month after a GAO report said that the ethanol tax credit is largely un-needed, Secretary Vilsack called for a re-thinking of the ethanol policy and Senators Tom Colburn of Oklahoma and Ben Cardin of Missouri introduced a bi-partisan bill in the Senate that would bring an end to the blenders tax credit. Similar legislation has been filed in the House. In other actions, Texas Dept of Ag hosted US Trade Rep Ron Kirk and met with Texas Ag leaders to talk of trade matters. During the month, the administration announced plans to eliminate the 20 year ban on Mexican trucks crossing the US border. The agreement calls for a phased in program where Mexican trucks must meet US safety standards. Mexico will suspend its retaliatory tariffs on American products. The big news to most of us coming out of the Texas Legislature was SB 332, ie, Groundwater Ownership Legislation, sponsored by Troy Fraser of Horseshoe Bay which was going to the full senate at the end of the month. This legislation would amend the Texas Water Code by clarifying that landowners have a vested ownership interest in the groundwater below their land. It recognizes the current authority of groundwater conservation districts. This legislation was/is of major importance to rural land owners in our state.

Meanwhile in the feed yards, with fewer available ready numbers of finished cattle a strong market at the first of the month got stronger. Fed prices that started the month at the $113.00 mark rose to a top of $118.00 before ending the last two full weeks at the $114.00 level. During the month, with hesitancy in the futures trade but with higher cutout values, a strong hide and offal trade and a high valued trim trade that is expected to go even higher, the live market was in strong hands. With limited red meat imports, reduced cow slaughter, warm weather demand, and tight numbers, the fed trade should remain in strong hands.

In the country and at the markets, seasonally light numbers were recorded in most cow calf areas and a little more than light in the yearling areas where it was dry and not much to graze. Slaughter cows and bulls worked even higher for the month and by month’s end saw some bulls up to and over the dollar and the best cows in the middle eighties. Feeder weight yearlings maintained their strong prices while calves got higher for the month. By the end of the month, light weight calves were scaring the $2.00 mark while the five weight cattle sold to the dollar fifty plus.

Goats, lambs, chicken and hogs are selling quite well and while hog slaughter has remained over the two million head per week has been in strong hands.

Spring is on us and prospects for livestock and commodity prices to be at or near historic highs is possible; it will all go for naught if we don’t get the moisture to produce with. Once again, weather and moisture are on our minds. Come on in April and see what you can do.

February Over My Shoulder

February as usual didn’t take long to come and go. Continued horrid weather over most of the county hung on the first days of the month before becoming only a memory at month’s end as moderating temperatures took over to end the month over a large part of the country. February ended with a need for moisture over most parts of Texas as spring planting got underway. Markets reacted in an upward pattern for most of the month and became stronger from the meat case to our local markets. The Texas legislature got underway and the same old bickering took place in Washington.

Early spring like weather seemed to take over most of Texas by the end of the month as planted small grains really perked up and began to grow and provide some nibbling at first and then some better eating. Many pastures began the greening up routine as many cows began to quit the winter feeding and started chasing the green grass and for the most part looked worse for doing so. The farm boys were looking at soil temps and really hooking up to get corn planted on an early basis and wait for some promised March moisture. The later planting guys finished their field work, put out fertilizer or what ever and got ready to plant just a little later.

Our Texas Legislature got underway and began to wrestle with budget concerns like almost every other state only we did it with much less fanfare. Our agriculture groups began to push the eminent domain and water issues that are important to all Texans. In Washington, events around the world seem to capture a lot of attention as well as our own continuing interests that currently need solving. On the agriculture front, we seem to be waking up and questioning our ethanol policies as our lawmakers continue the budget processes. In the meantime with no new laws being passed, the hardworking government agencies like the EPA are ratcheting up dust regulations, and as usual exceeding the authority originally given to them. Our government at work.

In the feedyards, we found that previous months placement were higher due to lack of grazing with more cattle going into the yards than last year but it seemed not to be a big surprise with weather conditions. Fed cattle ended the month with most cattle selling at the $110-$111.00 level. Prices were well supported in the futures markets and at the grocery store and helped with a strong trimmings prices and the hide and offal market. Numbers in the short term are favorable for these prices to remain fairly stable. Now all they have to worry about is cost of gains that aren’t going anywhere but up as grain prices are on the rise also.

Meanwhile at the markets, slaughter cow and bull prices have risen to historic highs as the best bulls have pushed the dollar bill and the top end cows have sold into the eighties. Calves and yearling have also hit unprecedented highs as only moderate season. The pork complex is also on the rising tide as weekly numbers are barely over the two milling head each week. Live prices have slowly risen past the fifties into the sixties on the better end.

Spring is around the corner and some of the weather boys are saying that March will be our wettest spring month. Capture it all, grow the early grass, calve your cows cause spring is trying to spring upon us.

END

January Over My Shoulder

What an eventful month the first month of the new year turned out to be!!! Our weather, world weather, and markets, and a new congress, our troubles, world troubles all made for an eventful month that was hard to keep up with. TV news and the pundits had a month of plenty to talk about.

The U.S. weather picture was one of plenty of winter the farther east and north that one happened to be. In Texas the central areas to East Texas and down south a way received the most rain in the state and perked up much of the planted grasses and even had a few days of growing temperatures and sunshine. Far west areas and the panhandle couldn’t buy any moisture, not even in the form of much snow and remained extremely dry.

Out in the world where weather patterns went hay wire, parts of the middle east, Australia, and even Brazil and elsewhere experienced disastrous conditions that threatened much life and property and disruption of business activities.

Agriculture markets in general remained in strong hands as grains, livestock, fibers, and most anything that comes out of the ground experienced continuing upward trends and in many cases reached new price highs for many commodities. World demand as well as our domestic demand was strong as supplies of most ag commodities remained tight on a world basis; the weak dollar seemed to be the biggest impediment to our trade as most countries would rather sell to a stronger currency.

In the feedyards numbers of ready cattle were met with a good demand, reached a high figure of $1.08 during the month before backing off to a $1.05 high at the end of the month. Two big factors adding value to fed cattle is a drop credit that is about a third higher compared to last year and the value of 90% lean trimming that have gotten higher and higher because of monstrous flooding conditions in Australia and those preferring to sell elsewhere because of the weak dollar.

In the country and at our local markets, numbers were moderate on a seasonal basis as little calves, big calves, yearlings, slaughter cows and bulls were all met with an excellent demand and escalating prices. At month’s end, a lot of the little steer calves sold we;; over the $150.00 mark, while some of the five weight cattle sold in the $130.00 plus range. There were even big bulls that sold into the ninety dollar range while the best cows sold in the seventies. All the meat type animals sold at or near record highs; goats sold close to or over $2.00 while lambs sold in the high one nineties. Even the hogs go into the act with hogs in the sixties and futures over the dollar mark for summer lean hogs. Animal proteins at their best and almost highest prices to the producer all at the same time. In the meantime, the Texas Legislature convened in Austin and started their debates over ID, eminent domain, and the budget that has to make up twenty billion or more. During the month, the first Brucellosis in five years was found in a small herd in Starr County. Fortunately, the new brucellosis rules, will not down grade Texas’s status while an effort is made to clean up the herd and determine the origin.

In Washington, a Republican dominated house gathered to try to work things out with the Democratic Senate. There’ll be some things that get worked out and some that won’t. A repeal of the health care bill passed the house, won’t go anywhere in the Senate, was largely symbolic. There was nothing symbolic about the Florida Feberal Judge’s ruling the entire health care bill unconstitutional on the last day of the month. It is likely that the case can skip appellate processes and go directly to the Supreme Court. Also on the last day of the month, FDA and USDA announced the 2010 Dietary Guidelines that are update every five years. Lean meat found a good seat at the table as too much salt in the diet took a licking.

Industry groups urged both houses to ratify the US/Korea Free Trade Agreement as quickly as possible while the President called for a review of all government programs and federal regulations to eliminate waste, fraud, and duplication. There was even more EPA rulings that sought more wide spread use of ethanol that stands to hurt animal ag even more. There seems to be plenty going on.

After a rough start to the new month, were gonna be looking for the first signs of spring as many areas will want to be planting feed grains by the middle of the month. Stock piling some moisture will be something that needs to be done as some places are wet on top but not down deep. Moisture, grass, and baby calves are just around the corner now for many. Let’s get started cause February won’t last long.

December Over My Shoulder

December came and went and took 2010 with it. It was a usual short marketing month with not much happening after two and a half full weeks to begin the month. During the month, fed cattle hit a high for the year at $104.00 and will be the figure to start the New Year with. Texas began the month very dry from North to South and after weather turned raunchy on the west and east coast finally brought a little moisture to our state.

Weather, escalating corn and grain prices, inventory concerns, domestic and foreign beef demand, and the general economy and what politicians thought they were gonna do about it all dominated our plates during this election year.

The year started with great hopes for a good weather year. El Nino had replaced the La Nina in the Pacific and the year was one of great promise moisture wise. The short lived El Nino early on gave way to a La Nina and our weather took on a drier outlook. By end of March many places were looking for the spring rains that stopped and by April most folks were still looking and then on into May. Tropical activity south of us kicked off June and July rains that seemed to pull a lot of areas out of the fire before forgetting how to rain in August that became extremely hot. More tropical activity in September meant good moisture again before La Nina once again took over and the moisture ceased from Texas to the East Coast. The experts are saying that we’ll look at a relatively dry situation into the first months of the New Year.

Throughout the year livestock markets with smaller inventories fared very well and the biggest concern to livestock producers and feeders became the escalating price of corn. Weather conditions in corn county kept the outcome of the size of the 2010 crop in limbo and succeeding forecasts from planting, through growing, and harvesting, kept decreasing the crop. Livestock groups pressured to no avail our lawmakers to do away with ethanol subsidies and let those folks stand on their own. It looks like they’ll not only get their subsidy but blend it with higher priced gasoline.

Price wise, fed cattle that started the year in the low eighties will end the year above the dollar mark after reaching as high as $104.00 toward the end of the year. Domestic demand has been surprisingly good and is expected to stay that way while prospects for a continuing good export demand is expected to strengthen on the heal of the US-Korean trade agreement and an improving political situation in Japan all aided by the weaker dollar. Slaughter hogs will end the year selling in the mid fifties while lambs and goats will continue to threaten the $2.00 mark. Unfortunately, over six dollar a bushel corn will take a big chunk out of anyone who feeds any of the above mentioned.

Perhaps the biggest concern throughout the past year and into the next will be how our law makers resolve our economic future or maybe yet, don’t solve our economic future. It’ll be a different make up of folks that’ll call the shots for the next two years; but somewhere, somehow all those folks are gonna have to learn how to work together for everyone’s good.

One of the few bright stars of our economy has been the agriculture segment; perhaps agriculture will continue to lead the entire economy out of the woods and get folks back to working. Weather conducive to production agriculture would be the first necessary ingredient to keeping ag production on the front burner and in the forefront of the economy. Come on New Year.

November Over My Shoulder

November is gone and the end of the year is fast approaching. Holidays and the do nothing month is in front of us as the year starts to wind down. Weather wise November was another dry month all over this state and all the way to the east coast. Weather makers simply didn’t materialize to bring much moisture to very many areas. Markets continued their up and down gyrations while heading into the holiday season. In just a few short weeks the marketing year will come to an end as not much will happen the last two weeks of the year. November elections were finally over during the first week and all the soothsayers begin their interpretations of what the election cycle brought us. It was good and bad mostly depending on the spin put on it by those involved.

The month started dry and ended that way in most areas. Early green grazing prospects that looked promising turned almost sour and non-existent in many areas. The saving grace was there was still some hay made, late cotton was harvested in the south and was ahead of schedule in other areas. Cooler nights and warm days kept calf health in jeopardy even though they have had two months of it and were somewhat conditioned. On the political front, little was done by our legislators except to bicker about what might come before them in the lame duck session and who was going to assume legislative leadership positions. In the meantime, agency bureaucrats stayed busy in promulgating rules.

Livestock and grain markets remained relatively high to the chagrin of livestock folks as yield and usage expectations of corn and soybeans were adjusted yet another time that will reflect lower total crops for corn and soybeans and higher usage than previously expected with corresponding price increases.

In our nation’s capital the big news for the industry remains GIPSA’s proposed marketing rules that have drawn the ire of most main stream livestock associations. GIPSA was chided early on for have no economic impact analysis so the industry commissioned three such analysis by independent sources. Their conclusions all indicated devastating long term results particularly for the beef industry. They all cited job losses and losses to gross domestic product by one and a half billion dollars as well as significant losses in tax revenues not withstanding what these changes would bring in terms of twenty first century marketing arrangements.

During the month, several animal ag groups urged congress to level the playing field for corn based ethanol producers. They say that ethanol producers have outlived their 50 cents/gallon federal subsidy. Ethanol producers are expected to use 4.7 billion bushels of the current crop that is 35 % of the total crop.

Two noteworthy industry happenings during the month shed good light and discussions on current industry problems. One addressed the question of the declining beef cow population and subsequent decline in feeder cattle as several interesting observations were discussed. Land use experts cited the availability and affordability of land; they discussed land use changes that include more hunting, farming, and government owned or controlled land that carries restrictions with it. It was noted that cow calf producers could fare better if they obtained relief from estate taxes, property taxes and ill conceived environmental and land use restrictions.

Another significant industry happening was the creation of the U.S. Farmers & Ranchers Alliance (USFRA) by 24 leading agriculture entities to include the American Farm Bureau, NCBA, CBB and many others to promote the positive image of modern agriculture. These organizations believe that a coordinated industry effort is needed to reach American consumers by those who produce our food and not by anti-agriculture groups who have opposing agendas.

In the feed lots, fed cattle prices began the month at the dollar mark, slipped a couple of dollars before trading at mostly $98.50 the rest of the month. Supplies are manageable and prices are helped by a solid futures complex, good demand that was particularly good during turkey season, and a strong export trade that is helped by the weakened dollar. Trade efforts in Korea have fallen down and in light of the military situation there will probably not be on their radar screen for awhile. Japan is showing signs of progress to perhaps up our tonnage there.

At the markets, seasonal runs of calves and slaughter cows and bulls have been the picture for the month with no big weather interruptions. Calf prices have remained strong as many in the industry believe that higher priced feeder cattle and higher priced grain will ultimately result in higher priced product in the grocery store. Slaughter cow and bull prices have remained relatively high reflecting the demand for ground beef. Beef, pork, and poultry are all sharing relatively better prices.

The end of the year is near meaning also that winter time will be upon us. At least this year, most producers will be entering the winter with enough hay supplies. Get thee behind us December, so that we can start a new year.

END

October Over My shoulder

October came and went and the roller coaster continued on. The best part about October coming to end was that the election cycle was also coming to an end and the rhetoric, posturing, and impossible promises would not have to cross the lips of office seekers for a while. Through the month, the roller coaster ride saw markets and weather go up and down; go to the top and then back down or vice versa.

The month began with drying weather, and as moisture makers quit coming, became drier by the day and by. The month ended and was darn near one of the records for lack of moisture almost everywhere in this state; dry conditions stretched into Oklahoma and then to the east coast. When folks south of I-10 in Louisiana complain about being dry, it’s sure nuff dry. For the most part hay making was over with, no grass was growing, no moisture to plant winter pasture on, and what did get planted did nothing but sit and wait for moisture. It’s a good thing that the month before saw a good bit of moisture.

Cattle and grain markets felt the roller coaster effect also. Corn started high and got higher after revised monthly crop reports, yield estimates, and acreage revisions. Fed cattle started high, lost luster, regained and got higher, then fell back again while feeder cattle were up and down with the price of corn. Other grains got serious yield revisions also; all of this while cotton flirted with dollar-plus a pound pricing.

In Washington as well as at State houses, all energies and concerns seemed to focus on elections. Will they or won’t they seemed to concern every pundit out there. Some will be right, others will be wrong. Let’s hope that “the people”, ie, us, end up being the winners in this election cycle.

With the election hoopla, congress did not get around to several tax bills and certainly didn’t get around to considering or taking action on the Death Tax. Several industry organizations sent letters to House and Senate members to take action but it never made it to anyone’s calendar. Our law makers didn’t do much during the month but our regulators did. EPA announced at mid month, long anticipated waivers to lift its blending rate of ethanol to gasoline to the 15% level. Corn futures hit the roof, cattle futures went down and the roller coaster took hold again.

The big news out of Washington as far as livestock was concerned is the boiling controversy over the proposed GIPSA rules concerning competition in the market place for cattle, hogs, and poultry. On one side are those that say that GIPSA didn’t go far enough while others say they have gone too far. It is probably obvious to most, that GIPSA, like many of our regulatory agencies are overstepping their authority and doing more than what was mandated to them by our law makers. This can happen when our lawmakers don’t spell out what they intend and the bureaucrats or political appointees take over. At any rate, the proposed rules are getting a lot of lip from the industry and it appears that GIPSA will do what they want to without listening to the industry. These proposals fall right in line with, adopt and find out later how they will be implemented or how they will affect the industries involved.

For the month in the feed yards, short ready numbers of fed cattle at first of month fell back to the $97.00 level, lost a little, gained a little, and during the third week gained nearly five bucks and traded the top cattle at $102.50 before ending the month at a disappointing $1.00 top. Many folks thought that the over dollar mark could/should have been around for awhile.

Meanwhile at our local markets, the calf deal gyrated a little with the upward price of corn before leveling off then gain a little steam to end the month. The slaughter cow and bulls market ended in strong hand at the end of the month.

The pork complex fared fairly well while kill level jumped to the over 2 million head per week range. They mostly sold in the mid to high forties.

Winter time is fast approaching as well as the end of the marketing year. Moisture would be on most folk’s immediate shopping lists if nothing more than to settle the dust. It’s mighty dry in some areas and they’ll need to start catching up before getting it during the full blown winter time.

END

September Over My Shoulder

September saw the weather turn around from the miserable preceding month, saw the fed cattle market move up, the yearling and calf market move down, and the grain deal move up while we all listened to election news and learned how USDA conducts listening sessions without listening.

September began by continuing the extremely hot weather of August but almost from the git-go saw moisture activity out of the Gulf that lasted almost the entire month. The last few days of the month saw cooler days and much cooler nights and just might be the signal that fall is around the corner. Tropical storms and hurricanes early in the month changed the moisture situation from critical to bearable and then just plain wet in many areas. As usual, there were areas that did not receive what they needed or got very little. The moisture was enough for most to plow or plant on it if that’s your deal and when you got to wheat in the panhandle there was even considerable volunteer wheat; some folks plowed it down and planted, while some preferred to keep it and continue on. During the month, rains and or showers played havoc with the cotton harvest, hay making and finishing up late grain harvest.

On the state and national political scene, election news was in the forefront, as our lawmakers traded barbs back and forth, while USDA was busy evaluating their end of August listening sessions on the proposed GIPSA rules on competition and Animal Disease Traceability. Many of us did not keep up with GIPSA’s mandate by the Congress to formulate new rules governing contracts and competition in the market place for poultry, pork, beef producers. Even before their late August listening session, USDA-GIPSA was severely chastised by the House Sub-Committee on Livestock for not following the mandates enumerated in the 2008 Farm Bill. The proposed rule was praised by some and castigated by others. An observation and remarks from some in attendance, was that the proposed rules were as important to the future of livestock marketing and production as the health care bill was to the future of health care, and at the one big listening session to receive feedback, many of the so called listeners couldn’t even be bothered to sit through the long session on the day that it was held. It apparently was not important enough for them to stay and listen to what producers of the country thought about their proposed rules. Sound somewhat familiar?

Other news of importance was that scientists at Purdue University in a study, found that Infrared Spectrocopy can detect E. Coli much faster than current testing methods. They found that they could determine the presence of or lack of E-coli in one hour versus the current 48 hours for a confirming test. In other news, oral arguments were begun in the WTO complaints by Canada and Mexico relative Country of Origin Labeling (COOL). The two countries are claiming that they have been harmed by the COOL law.

In the feedyards, a slightly increasing number of fed cattle reached harvest time during the month as carcass weights remained lighter than last year. The market started the month at a weakened $97 mark and put on a little to finish the month about a dollar higher. Pretty good for a month that saw corn go over the $5.00/bushel market for the first time in a long time. Revisions in last year’s carry over, predictions of a smaller crop and lower yields are all factors that have contributed to corn price increases. The saving graces to fed cattle prices is steady-higher offal prices, lighter carcass weights, good domestic beef demand and an increase in exports that have amounted to a 25% gain in dollar value over a year ago. Even with more harvest ready cattle, suppliers have reached into the stockpiles of frozen stocks and reduced them by a large factor.

At the markets, September acted somewhat predictably with a seasonal increase in calf numbers with a decline in calf values because of numbers, sickness, and rising grain prices. The saving grace is that the current market is still at high levels despite experiencing a seasonal low in price. The big calves can still sell over the dollar just not as far over as before while the lighter weights will sell a good bit over. The top end of the slaughter cows will sell above the $50 mark while the best bulls will sell into the seventies.

The pork boys fared well during the month as numbers have been more than manageable allowing finished top hog prices into the sixties. During the month, bacon hit an all time high in price and has put a crimp into breakfast.

We’re down to about 90 days left in the year, mind your p’s and q’s and keep up with your marketings and don’t get caught by weather or whatever. Let’s hope October brings just cooler weather and nothing cold while we wait out the rest of hurricane season.

-END-

August Over My Shoulder

(Click on to print a PDF Version)

August weather returned to typical patterns while markets remained strong and reflective of strong and/or improving market fundamentals. Washington law makers toned down a little during a recess while some USDA agencies geared up several projects.

In a few words, August weather saw limited moisture, was hot, sunny, humid, and became downright brutal about a week into the month. End of month saw northern frontal activity bring a little unsettled weather into the picture. Weather was conducive to rice harvest, grain harvest, and finishing up the milo harvest and making hay. By mid month top moisture disappeared, and the relentless beating sun burned up pasture grasses in many areas. It appeared like there had been no moisture during the preceding two months. Many areas set records for highest average temperatures due mostly to night time temperatures that were several degrees higher than usual. The only things that I know that likes the extreme heat is the devil and growing cotton.

The congress recessed but before they did, the Senate passed the Re-authorization of the Livestock Mandatory Price Reporting Act; the house will act when they return. This bill is strongly supported by the industry. Before they recessed, the house introduced the “E.coli Traceability and Eradication Act”. The bill would require stricter testing procedures for ground meat and processing facilities and institute a tracking procedure intended to enable USDA to implement faster recalls.

The really big news throughout the month was the impending Department of Justice and Packers and Stockyards Administration joint “Competition” work shop that was to be held on Friday, August 27^th This workshop was really a hearing or listening session concerning the proposed rules issued by P & SA at the end of June. Opposing sides of the debate over the proposed rules are divided with one side saying that the rules are needed to insure competition and fairness to all in the market place while the other side says that it would destroy the system that has evolved over the past few years that has well served the industry and consumers to insure high quality beef This writer does not think that the truth is in the middle, he thinks that adoption of the rules would take our industry back fifty years and have many unintended consequences for producers and consumers.

Good news for the month was news that Mexico was dropping their anti-dumping duties against US beef imports that for ten years has ranged from $.03 to $ .29 per pound. Several days later Mexico added pork to their expanding, rotating lists of goods that will have duties placed on them for retaliation for the US calling to an end the trial period for Mexican trucks coming into the US through the NAFTA agreement.

In the feedyards with tight ready numbers of harvest ready cattle, fed cattle prices that started the month at the $93.50 level steadily increased during the month to reach $100.00 per hundredweight before backing down just slightly. Prices were aided by strong cut out values, near and far out futures, hide and offal prices, and declining cold storage inventories of all meats. Domestic demand is improving slightly while export demand is showing an increase for the year of 20 percent over last year and continuing. The same is true for pork and poultry.

At the markets, after a somewhat slow previous month, August resumed a seasonal pace with numbers coming to town. Cow numbers moderated a little while there were plenty of big calves in the calf mix. Both sold with a good demand and sold mostly sideways-stronger throughout the month. Little calves sold over the $1.30 mark, the four weights to the buck thirty and even more, while the 5 and 6 weights sold well over the dollar.

August is gone and it might be time for a break in the weather. A few more fronts to cool us down and provide September moisture would be a good and welcomed thing. Come on September.

ER MY SHOULDER FOR CITY STOCKYARDS CO., SEALY,

July Over My Shoulder

July continued the good and not so good of the month of June. June was a rainy one that turned into a rare rainy July and continued the news of the Gulf oil disaster, immigration problems, a lack luster economy and a failing jobs market. Livestock markets were in strong hands while the grain markets jockied a little with weather and report concerns.

As in June, "July doesn’t always promise moisture but it sure did this year and it was extremely timely over a large area; as usual it was spotty as some folks received quite a bit more than others. Despite hot days and hot nights there seemed to be enough moisture to grow a good bit of grass and most folks ended the month in better shape grass wise than the way they started." Quoted verbatim from last month about June activity.

First of month saw much moisture from tropical activity that seemed to keep moisture activity stirred up throughout the month. Most but not areas of the state received from a little to a great deal of moisture throughout the month that continued to grow pasture grasses and hay. Despite long rainy periods, plenty of hay was made in most areas and has allowed folks to begin stockpiling hay reserves. Hot days and warm nights and abundant moisture can grow lots of grass even in July.

The ag news in Texas still centered around security issues with some of our Texas/Mexican Export pens and the continuing Fever Tick issue. On the national scene, the big news was industry and congressional reaction to GIPSA’s (Grain Inspection, Packer and Stockyards Agency of USDA) proposed new rules relative to competition in the livestock sector. They issued new rules pursuant authorization by the 2008 Farm Bill. These new rules addressed forward contracts, packer ownership of livestock, and other market competition concerns. They originally had a comment deadline of August 23^rd until they ran into intense scrutinizing from the Livestock Sub Committee of the House Agriculture Committee. Industry reaction has for the most part been negative, not so much from the idea of insuring competition but that the rules are ambiguous, incomplete, not definitive, open to too much interpretation. Many say the rules as proposed would be "a lawyer’s heaven". Reluctantly, GIPSA did extend the comment period for 90 days after succumbing to industry and congressional pressures.

Other news out of the national scene was the announcement by the Cattleman’s Beef Board’s audit of NCBA activities with the CBBA that included parts of 2008, 09, and 2010. This is part of the on-going rift between NCBA and CBB over their relationship and that of the Federation of State Beef Councils. It looks like a likely extension of the Mandatory Price Reporting is in the works as the house and senate both are considering a five year extension. In other news, the CBO is now saying that the Biofuels industry no longer needs tax credits for their programs, a move supported by most livestock groups that is slated to receive attention because of its cost cutting aspects. And from the Cooperative for Dairies, the news that they have accepted 34,442 cows for the next dairy buyout expected to begin sometime in August.

Good news on the export front a store chain in Korea has accepted and is featuring T-bone steaks for the first time in many months. It now appears that the U.S. and Japan can now schedule talks for increased trade, since they seem to be getting a handle on the outbreaks of FMD that has occupied them for several months.

In the feed yards, July prices started on the strong side at $91.00, rose to the $95.00 level before receding to a high of $93.00 at month’s end. The market did all that with minimal support from carcass cutouts or close in future’s support. The mid- year report indicates fewer cows meaning a continuation of fewer feeder cattle and even with May and June feedyard placements being over last year has had minimal impact so far and probably won’t some say.

At the market on our level, July numbers moderated as most folks had cleaned up old crop cattle on a high market and were content to watch the grass and calves both get bigger throughout the month. The calf trade was still very good and high as well as processing cows and bulls.

The pork complex has remained in strong hands as fewer numbers has allowed profitability in the industry.

We’re now looking towards the end of the summer months and in the strange position of seeing growing, green, conditions over a large part of the country. Looks to me like we better start figuring out what to do with a large number of bigger, fleshier, calves a little later on. Looks like a good problem to me.

END

June Over My Shoulder

June was punctuated during the month by many of the May carryovers; ie, the drilling disaster in the Gulf, immigration law in Arizona, Supreme Court nominee hearings, the economy and its recovery. Weather wise, many of the areas in need of moisture at beginning of the month received the much needed ingredient to grow grass and finish off grain production. The month of June brought a good bit of ag news in the state, the nation and in trade concerns. June markets traded mostly sideways to strong or sideways to weaker with nothing falling out of bed except the stock market towards the end of the month.

June doesn’t always promise moisture but it sure did this year and it was extremely timely over a large area; as usual it was spotty as some folks received quite a bit more than others. Despite hot days and hot nights there seemed to be enough moisture to grow a good bit of grass and most folks ended the month in better shape grass wise than the way they started. The month started with moisture from the north and ended with weather from the South in the form of tropical activity.

Ag news in Texas centered around security issues with some of our Texas/Mexican Export pens, the continuing Fever Tick issue, and announcement from Texas AgriLive Extension relative a fed beef comparison to grass fed beef. Researchers compared ground beef from fed cattle and ground beef from grass fed cattle and found evidence favoring fed beef as more beneficial to human health. About the same time a new USDA report suggests an upward trend in the consumption of grass fed cattle, although it still remains a niche market.

During the month, USDA-APHIS began hearings on a new Animal Disease Traceability Framework Approach to replace the earlier discarded National Animal Identification System that they and the industry had worked on for years. USDA-GIPSA (Grain Inspection-Packer & Stockyards Administration) announced new rules on competition, ownership, and forward contracting of livestock as was dictated by the 2008 Farm Bill. GIPSA will take comments until August 23^,before issuing final rules.

On the last day of June, the Senate Ag Committee is supposed to begin talks relative the next Farm Bill. And last but not least out of Washington, cattle folks sent messages to USDA-APHIS about their rule to possibly allow imports from regions of Brazil that have been declared free of Foot and Mouth disease.

On the trade front that has been very good since the first of the year, the US and Japan have put any beef trade talk on the back burner while Japan focuses on their Foot and Mouth disease problems. During the month Taiwan officials indicated that they want to inspect US packing plants to address labeling issues. The big bomb shell on the trade front has been a tentative beef trade agreement between Canada and China that will and has wrinkled the noses of government and cattle groups across the country.

The big thing out of USDA was their admonition to NCBA over their thoughts of changing the governance structure relative NCBA and the Federation of State Beef Councils. As a result, NCBA will hold off on any vote to restructure their relationship with the Federation.

In the feedyards, at the front of the month, fed cattle sold in the middle nineties and were supported by strengthing drop credits, good cut out values, and movement. As the month progressed, support from futures eroded, movement slowed, cutouts values fell and the top end fed prices fell to $91.00 as packers gathered supplies for the 4^th of July holiday. Current drop credits have been bolstered by a 95% increase in hide values compared to last year, tallow at 23% higher, variety meats up 50% and pet food items up 34%.

At the markets we’re still looking at excellent demand for processing cows and bulls as well as stocker calves. Into the sixties on the best cows, the seventies on the best bulls while the light weight calves are well into the dollar twenty and above while the better five and six weight cattle are selling above the dollar mark. With timely June rains, market runs will be able to stick to more or less seasonal patterns as far as numbers go.

The pork deal is good and is aided by a good domestic demand as well as seeing increased export trade. Hogs in the sixties make life a little easier for the hog boys.

We’re now in the middle of summer with a shot at continuing moisture that should help the grass and hay situation. A little cooler and little more moisture won’t hurt anyone’s feeling that I know.

END

May Over My Shoulder

My-o-my…..how do the months go by so quickly! The last of the spring months began with a need for moisture and ended the same way, particularly in the coastal bend area of our State. The news was dominated by the drilling disaster in the Gulf with the usual finger pointing, the new immigration laws in Arizona, Supreme Court nominees, world wide economic news, a change of government in England, and good markets until they crashed around us through no fault of our own.

The month promised much and delivered little in terms of moisture. Only one weather maker at mid month produced beneficial rains pretty well all over and after that showers became a hit and mostly miss proposition for most areas. By end of month, longer days, near 100 degree temperatures, and lack of top moisture brought an end to spring grasses and weeds, and proved to be a hindrance to growing summer grasses. The corn and milo boys will need more moisture to make their grain, while a lot of the cotton boys spent the month replanting because of poor stands. The “good moisture” promises at beginning of the year, have turned into the same empty promises of the past few years. Whatever happened to El Nino? He didn’t last very long!

On the national scene there was much going on that concerned the world of agriculture. Livestock groups began to petition congress for an end to ethanol supports, citing a mature corn based ethanol industry should compete for corn stocks just like the non-subsidized feeding industries. The ongoing fight over antibiotics in animal feeds continued during congressional hearings during the month; two key senators took USDA to tasks for diverting funds from needed rural development projects to further the administration’s “locavore” initiatives.

Meanwhile, during the month, USDA, through Ag Secretary Vilsack, informed National Cattlemens Beef Association officials of USDA concerns about their proposed new governance structure as proposed by their Governance Taskforce. The concerns that USDA has, all center on NCBA’s relationship with the Federation of State Beef Councils which was created by the Beef Checkoff Program that USDA has over-site over.

USDA held hearings on the new traceability approach that was outlined earlier in the year and will continue to hold listening sessions on competition in the livestock sector. The Secretary also announced a $40 million purchase of beef product for the National School Lunch Program, the School Breakfast Program, the Summer Food Service Program, the Food Distribution program on Indian Reservations, the Commodity Supplemental Food Programs, and the Emergency Program. As far as I know, I don’t qualify for any of these.

In the market place, the month began on a solid basis that continued to support strong fed cattle prices, feeder cattle prices, and stocker prices. The fed market started the month with a good many cattle selling for a $1.00, being well supported by the May and June futures, higher cutout values, very good out front sales volumes, and excellent export volume. The second week continued the trend but sensed a slow down. By the end of the third week, when the stock market, reacting to whatever it reacts to, fell precipitously on one day, took our industry with it as general uncertainty engulfed the markets. By end of month, the June futures fell some nine dollars, choice cutouts dropped over five bucks, and the live market dropped almost ten dollars. Our fundamentals didn’t change, the world’s did and we all take the gaff. The uncertain times we live in!

At the markets, cow/calf folks took the hickies just like everybody else as slaughter cow and bull prices as well as calf prices backed off to end the month after riding high for the first half.

June is here and will start with a need for more moisture to grow summer grasses and keep the crop boys going. Seems like we have entered this month like this for several years now. Sometimes, we get lucky, maybe we will this year.

END

April Over My Shoulder

The spring month of April is gone and left a mixed bag of treats. Weather was a treat for some; a bane to others, Cattle markets were good for most if you were selling something and tougher if you were on the buying end. There seemed to be a good bit going on in the industry that could be favorable and well as unfavorable. Nothing new, we’ll roll with the punches as usual.

Spring weather seemed to be a series of fast moving fronts that collided with Gulf moisture and either hit you or missed you. The further north and north-east you were, the more likely you were to see a good bit more weather, some even violent that resulted in damaging winds and tornadoes. Most of Texas received some very good rains but if you reside in the Coastal Bend area you saw the weather makers but you didn’t see very much moisture. Moisture was virtually non existent in the Coastal Bend, a good bit of East Texas and on into Louisiana and eastward.

The mixed bag of the weather, allowed for a very good hay making month, while most of the farm boys finished all plantings, except beans and on into the northern and mid west areas the planting of corn was weeks ahead of last year. The planting intentions reports are estimating 2.2 million more acres of corn and a half million more acres of soy beans and will come from lands leaving the CRP Program and with less wheat in the forecast. Looks like it will be in the ground a lot earlier than last year.

Meanwhile, cattle markets got a shot in the arm beginning at the top with the fed market, a supportive retail complex, supportive feeder futures and a spring forage and grass fever making the grazing boys charge ahead.

On the political scene, the financial markets overall seemed to grab most of the national attention as well as immigration and energy reform. Fact is, those that set the agendas, are trying to figure out what to tackle next. Ag groups began pushing for meaningful and permanent estate tax reforms as the end of this year means the end of our temporary rules governing estate taxes. The groups are pushing to allow limits to at least $5 million and a much lower top tax rate.

In the meantime, The Dept of Homeland Security will provide 21 million dollars to Texas A & M and to Kansas State University for work on animal disease control and prevention. This work will focus on development of new vaccines, rapid diagnostics methods, models to simulate disease outbreaks, and educational programs to train first responders. We’ll all reap the benefits that trickle out of this one.

Imports and exports dominated much thought and time throughout the month. Efforts out of the US Trade Reps office began to show results. Much discussion with Brazil over a long standing cotton trade dispute also included possible imports of Brazilian beef into the US market. Reports out of USMEF indicate that so far this year that Canada’s import volume is 19% up with a 25% increase in value; Japan is 45% and 35% in value; Greater China and Vietnam are up 36% and 38% in value while the Middle East is 28% and 50% up in value. Slowly but surely.

In the feedyards, fed cattle prices that started the month in the mid nineties, soared to a $1.00 with the help of fewer ready numbers that are lighter than last year, supportive cut out values, and retailers that held their margins and kept product moving. The Cattle on Feed report showed 3% fewer cattle even with a 3 % increase in placements and 4% more marketed numbers than last year. Cold storage reports for the month even showed significantly less beef, pork, and poultry in storage. We’re either eating it or exporting it, we’re not throwing it out. Beef and pork have outstripped poultry in price increases and is expected to have a tough few weeks as retailers are expected to feature more fresh poultry.

In the markets, April runs were about seasonal but with a larger number of slaughter cows as so far this year, cow slaughter has jumped ahead of last year in nearly every part of the country. Despite more numbers, cow and bull prices have risen to new historial highs because of less processing meat coming into the country. Calf prices have been supported with less total numbers and feeder futures that have been supportive. Sure is nice to have something that someone else wants.

May is here and plenty of folks are in need of top moisture to keep grass and crops going like they should before it get too hot. El Nino needs to come through and bring more moisture than what we’ve seen in late March and all of April.D

March Over My Shoulder

March is gone and if the beginning of spring hasn’t reached you yet, it soon will. March started wet, began to grow, got kicked in the foot, cause winter didn’t want to quit; but longer days and the tilt of the earth will soon warm us up and we’ll sure nuff see growing weather ahead of us. March markets for the most part were good to cowpeople as we saw increases in the fed market and a continuation of higher calf and feeder cattle prices as well as the cow and bull trade. There was even big time news from elections and from elected officials. To say the least, March was active.

March began with a cold front and rain over most of the state and continued during the month with faster and faster moving fronts that brought more rain and even snow to many areas. Farm boys that began the month with limited planting accomplished worked a little land and planted between fronts with slightly warming temperatures. End of month finally saw nighttime as well as daytime temperatures increase but still be too cool and too wet in some areas to get much outside work done. Obviously, sub moisture is plentiful most everywhere, but as we go along there will be a need for additional top moisture for grass as well as crops.

March was full of non industry news and well as much ag industry news. Beginning with primary elections at home and across the nation at first of the month, health care debate on the national scene seemed to be all anybody talked about and then finally house passage and signing by the President. The political maneuvering hasn’t stopped yet and looks like it will continue for a long time. On the agriculture front, several key senators and house members have petitioned the administration to insist that Japan immediately grant increased market access for U.S. beef. Others have asked that the administration resolve the year long Mexican trucking dispute that pulled funding from the pilot program of cross border trucking that was/is a part of NAFTA. There was news of more states trying to get ahead of the animal rights folks by enacting state regulations and assurances for animal welfare. There was even a new bill in the U.S. House that is backed by the Humane Society of the U.S. (HSUS) entitled “Prevention of Farm Animal Cruelty Act”. The bill would set animal confinement rules for producers who sell food to the federal government. Is it to be considered by the Ag Committee? NO; the bill has been filed in the House Committee on Oversite and Government Reform. If we don’t take care of our own business, there are others who will.

Probably the biggest bombshell to hit the air ways since the reports of bad science and false reports in the global warning controversy is the United Nations owning up to bad science in the four year old definitive report entitled “Livestock’s Long Shadow”. Now, the report is coming unraveled, thanks to efforts by researchers at the University of California, funded, in part by the Beef Checkoff Program, that debunks livestock’s role in the emission of greenhouse gas (GHG). The world we live in!

Fed cattle took an upward spiral during the month as fed cattle prices rose from the middle eighties to the high nineties before backing off at end of month. The market was supported by higher cutout values, significantly lighter carcass weights, increasing drop values and higher futures. Packer margins were well into the black. There are those that are saying that either cutout values will retreat or cash cattle and futures will come roaring back. The divergence of the two segments, they say, will not last for long.

Meanwhile at the markets, with fed cattle prices as a cue, moderating temperatures and abundant moisture, will allow plenty of green grazing to began a re-growth stage that can graze a lot more cattle than during the winter. Demand is/was good for all calves, regardless of weight, sex, or kind, but was particularly good on any grazing weight cattle that could go back out to finish up green grazing. Most of the calves coming to town were well conditioned because of the winter spent on their mommas. Light weight calves prices well over the dollar mark were common with a good many heavy weight cattle either side of the dollar. Slaughter cows and bulls reached decade highs as very few came to town.

The pork complex trended lower most of the month and ended in the fifty dollar neighborhood. Low priced pork product competes with our beef on the grocery shelf.

Spring is here with the need for warming temperatures and a continuation of top moisture. Spring time brings baby calves and when it appears that we have something to eat it becomes an unbeatable combination.

END

February Over My Shoulder

The short month of the year is now over and from the standpoint of weather, most want to see it over with. From the markets standpoint most would like to see February prices hang around for a good while. Meanwhile in Washington, the biggest news to us ag folks might be that USDA is back to the drawing board with a national ID system.

February weather across the nation was harsh and helped to make this winter a very long one in most parts of the country. It’s taken its toll on livestock from production areas to the feeding areas and has caused lots of losses in terms of lost animals, lost performance and monetary costs and losses. Depending on where you were in the country, it was excessive snow, rain, mud, temperature or whatever, and generally made life with livestock miserable. February is now over with and the first spring month is now on us. More moderate temperatures are in the near future and it seems there will plenty of moisture in most places. As usual though, there are a few areas particularly in far south Texas that haven’t received what they should to get spring off to a good start.

The weather was cold on the East Coast, but hot in Washington as talk of another go round of health care debate heated up during the month. Of interest to ag folks, Secretary of Agriculture, Vilsack, announced that USDA had listened to the industry during the fall in hearings around the country concerning NAIS (National Animal ID System) and was scrapping those plans. He asked for industry help in establishing a trace back system beginning with livestock that entered interstate commerce. We’ll have to see how all of this plays out.

In the feedyards, where ever they are, snow and rain made for muddy, sloppy conditions that affected performance and yields and added days to feeding time. As ready supplies of harvest ready cattle slowed down, packers hunted for supplies and fed prices jumped from the mid eighties to the low nineties. Quality, yields, and carcass weight all took hits because of the weather.

Meanwhile in the country, farmers twiddled their thumbs, unable to burn any diesel and work some land for the first time since the late harvests of last year. Cowboys caught a little break from January weather and worked a few cattle and came to town with a large number of still big calves. While they were able to work a few cattle, numbers were basically short and demand begin to grow with the spring moisture prospects. Slaughter cows and bulls took quantum leaps in prices as well as the feeder cattle. The light weight calves jumped well over the dollar bill while the heavier steer and heifer calves sold high nineties to over the dollar. Slaughter cows sold into the sixties while the best bulls sold into the seventies.

The pork complex with slightly fewer numbers sold into the mid fifties and were affected with movement difficulties just like the fed cattle.

Spring is around the corner for us in the southern areas and a little longer for those in the north. Daylight hours are increasing and we’ll start to warm up. When we dry up a little, we ought to jump start the planted green grazing, clover, and winter grasses before a full fledged spring. It really needs to get here pretty quick because most folks are running out of hay. Come on March.

January Over My Shoulder

January ushered in the new year with better long-range weather prognostications and less than usual expectations about our industry and our economy. By end of month with more than ample rainfall, the prospects for a good spring were emerging; and there were end of month signs of regaining our political health and even the economy saw improving indicators. What do they say?; it’s always darkest before dawn, well hooray for dawn coming.

January weather for the entire month was weather not seen in several years. West to East and North to South, no area seemed to be spared from excessive rain, snow, ice, or temperatures that caused much concern in livestock land and in southern areas of citrus production. It wasn’t an easy month; livestock markets were generally stronger while grain softened. Outside work took a back seat cause of temps or rain or flat out snowy, wet, muddy conditions. It was an eventful month in other ways, the big news in Washington was still the economy, health care, senatorial elections, trade disputes, and confirmation hearings while here at home the gubernatorial election season took off like a big bird.

There was ag and livestock news out of the capitol as the month started with Taiwan backtracking on the late year agreement to allow expanded market access for U.S. beef. Leaders in the House Ways and Means committee urged the Administration to put pressure on Taiwan through the U.S. Trade Representative. In other export news, late year increases in exports were encouraging but the year still ended with total exports being less than the year before. South Korea led the late year surge. Also out of the capitol came USDA revision of the 2009 corn crop that indicated more corn than previously thought to end the year with a 13.2 billion bu crop and establish a new record yield of 165.2 bushels per acre. The national ID programs is back on the radar as several livestock groups have banded together to present a statement of 12 principles to USDA and to congress. The statement stressed confidentiality, minimum costs, operate at the speed of commerce, and be voluntarily phased in over time.

A new industry self-help initiative has been a new video developed by the Texas Beef Counsel and Texas Farm Bureau that will put a New Face on the Beef Industry. It utilizes beef producers to tell the modern beef production story to consumers with the goal of education and understanding.

Here at home, the month started cold, then came moisture and made for some tough conditions. Outside work was hampered and in many cases was relegated to fixing pipes, working on wells, and feeding cattle. In the feedyards, with snow, ice and then mud, performance suffered but markets took on stronger tones until the end of the month when there just wasn’t much activity. During the month though, movement was fairly heavy while packers saw increases in drop credits because of strengths in the hide, tallow, pet foods, and meat and bone meal markets. The month started with fed cattle prices in the lower to mid eighties and saw a rise to $86.00 before making no trades the last days of the month.

At our local markets, the month saw heavier than usual numbers, partially due to more hold over cattle that were prevented from being marketed because of end of year weather. The market started slow but was fast to pick up and by end of month saw the heavy calves higher by several dollars and the lighter weights higher by a lot more. Slaughter cows and bulls picked up steam as the month progressed and ended a few dollars higher than they started.

Slaughter hog numbers backed off slightly during the month and most top weight porkers sold mid to high forties. Weekly numbers still are over two million head each week but are below year ago numbers.

An improving economy bringing on better domestic demand and expanded exports are what our industry needs. First things first though, let’s get spring here with more moisture over a wider area so that we can see a better production year than the last few. Come on February. END-

DECEMBER OVER MY SHOULDER

December and the end of the year is on us and it seems like both just got started. My-oh-my, where does time go? December will end the year wet after experiencing the harshest weather so far this winter and maybe even for the past few years; not only in our state but the nation as well. Local markets at first of month saw light numbers as weather hampered movement in the county and at the end on the month most markets saw no sales activity. The fed cattle trade saw an increase in activity and prices at the end of the month and put on a couple of dollars to end at the $82.00 level. The only political activity out of Washington for the month was the vote to raise the debt ceiling and the Senate debate over health insurance reform. It seems that insurance reform is a long way from health care reform which was the rally cry way back when.

My, what a year this one has been! Extreme to extreme seem to set the pattern throughout the year in all that we did. Rainfall totals in most areas will be close to what we call normal annual rainfall, but it certainly doesn’t reflect how miserably dry and difficult an operating year that it really was. 2009 started dry, ended wet; first half of the year couldn’t grow grass to take care of a cow, and ended with our cattle in pretty good shape to start the winter; first of year we couldn’t make any hay and ended the year with hay not made because of excessive and constant moisture. Most will scramble for enough hay stocks to make the winter that started wet and looks like it will end wet. It’s certainly different from the past few winters.

The year started with an economy in shambles, and doubtful as to whether or not proposed solutions would give us a fix. We installed a new administration, at the first of the year, and in the ag world, still talked of a delay in the implementation of COOL, problems with NAFTA, horse slaughter concerns, and the National Animal ID System.

At mid year we saw the first of three dairy buyouts for the year; another BSE cow in Canada, a TB cow in Texas, fewer cattle, hogs, and chickens on feed and an export trade that reflected struggling economies in the rest of the world. About midyear, the house and senate both jerked the funds from the National ID System (NAIS) and all at once started talking Supreme Court Nominee, Climate Change Bill and Cap and Trade and almost nothing else until the health care issue dominated the political processes till the end of the year.

However, while others were talking the major issues, there were a few others that seemed to be concerned with humane slaughter of all livestock species, how ground beef is to be handled, and a myriad of other things that others want to police for the ag community if we won’t or don’t do it ourselves within the existing rules that we have in place for our industry.

On the market scene, in the feedlots, first of year began in the low $80’s, saw a rise to a spring/summer high of $86.00 in May before declining to $82.00 then back to a high of $88.00 in October to end in the year in the lower $80’s. End of year saw significantly fewer cattle on feed as well as declining pork and poultry production. All in all, with a shift in eating habits to eating more meals at home, competition for the meat dollar was tough. Calf prices were fairly bright at first of year, turned down into the summer, and turned worse into the fall reflecting the uncertainty in the economy, the price of grains, feeding conditions, grazing conditions and the fed market outlook.

We’re kicking out a year that few would want to re-live. We faced and solved many problems and questions and as usual will begin the new year, like we always do, with other problems and questions. If we can take care of a cow with adequate moisture and growing conditions, we can usually find a way to survive the new set of problems and conditions that a new year brings. It looks like the start of a year that will have the moisture to grow the grass that we haven’t had the past couple of year. Come on New Year.

November Over My Shoulder

November followed the good pattern of September and October with continuing moisture and by month’s end saw some real winter weather in the form of colder temps and snow in the north. In the markets, fed cattle started the month strong, lost its glow, settled downward, while the calf trade never saw a glow with a shorter than average marketing month and in the grain end, analyst’s spent the month trying to figure out how a late harvest was ultimately going to affect corn yields and prices. On the political front, the folks in Washington were consumed with health care issues and how to outfox one another in the processes.

We seemed to get a little moisture in most places at sometime during the month. November moisture, while probably not as much as the month before, kept green grazing growing, didn’t hamper outside activity quite like it did the month before, and added to the rainfall totals in many areas, that will make yearly totals almost appear normal by the time it’s all over with. By end of month, winter like temperatures put the frost line further and further south. Still by month’s end many areas from I-10 south didn’t see a frost.

Out of Washington comes the news of another knee jerk reaction as one of our California Senators has introduced legislation to create an Office of Humane Slaughter within FSIS. One more example of someone wanting deprive the industry of regulating itself. Others in Washington are celebrating the first year of Mandatory COOL by wanting to include dairy products at the same time the World Trade Organization has announced that they will establish a “dispute settlement panel” to consider complaints from Mexico and Canada. During the month, USDA announced the allocation of 234 million to promote US food and agricultural products to our overseas markets. Beef export news has again been hot and cold; exports are down overall with the most declines coming from Mexico and Canada while exports to Japan are an the increase and Taiwan is now open to bone-in beef. In the feedyards, the month started strong, with the expectation that the market might stay in strong hands for a while with tighter supplies and declining carcass weights. $88.00 cattle at first of month turned into $85.00 cattle even as carcass weights declined dramatically and supplies tightened mightily. Market support at the retail level has to be what affects us most; if our families don’t have the money to spend they won’t spend it. Families don’t usually operate the same way governments do.

At the markets, some folks who put off working in October came to town with calves that ended up with more large calves than usually seen in November. Heard the comment more than once, that the cattle response to early fall rains exceeded most folks expectations about how a cow could improve in conditions and continue to make her calf much larger at the same time. For the most part, calves for the month were much larger than usual and unfortunately, the larger the calf the bigger the hicky for the month as the market just couldn’t get un-tracked with declining fed prices and grain harvest unrest. Calf prices at our local markets seemed to bog down a little more each week as the month progressed as did slaughter cow and bull prices. The fog cleared at end of month as most markets did not conduct weekly sales for the entire Thanksgiving week.

The pork complex fared about like it has the past several months; most projections for 2010 are saying that finished hogs will lose $10.00 a head throughout the year. Nice forecast, huh. The lower priced hogs don’t help beef in the grocery store.

December is here and it will be a short month as it will see only three marketing weeks before everything comes to a screeching halt for the month and the year. The month is gonna start wet and cool and if you haven’t seen a frost yet, you probably will fairly quickly.

November is here and it’s still green from Texas across the South. Maybe we’ll keep the cold to the north and be spared a frost for a little while. It wouldn’t hurt most folks feelings.

SEPTEMBER OVER MY SHOULDER

The whole month of September broke the mold of the past many months, when almost the entire month saw significant cloudy, overcast, drizzly days and even full fledged rains in many parts of the state. At sometime during the month we saw the moisture come from the North, then the South and Southwest and all the while temperatures for the most part stayed relatively high with just a few cool days or nights. Markets seem to gyrate sideways most of the month, saw just a few surprises while ag news and activities from Washington or Austin seemed to be relatively quiet.

Weather makers over the entire middle section and southeastern parts of the country seemed to be the way of the month for September. In the areas of the state that saw limited or no moisture during the summer months, it was a welcomed relief as a little bit of rain fell, then a little more and all of a sudden large areas seemed to green up and then grow a grass. In some of the grazing areas to the north, wheat and oat planting got underway, had very few problems coming up and then kept growing because there was continuing moisture. Many areas had enough moisture to not only green up hay fields and pastures but grow enough to do some real good and to crank the hay balers up once again. By end of month, with slightly lower temperatures the very much un-invited Armyworms showed up at the table and had their way unless they partook of enough Sevin to do them in. Between continuing rainy and cloudy days and the Armyworms, plenty of hay that was ready to be cut was still un-made as the month ended.

Little news came out of Washington if it didn’t start with health care or environment, or cap and trade. There was what most are calling a positive change in leadership of the Senate Agriculture Committee as Tom Harkin left the committee to become MsoNormal" style="text-align:justify;line-height:150%"> Also, out of the fertile, some what reactionary minds of our lawmakers comes the bill entitle “The E Coli Eradication Act”. A bill introduced by Senator Gillibrand of New York that will require all plants that process ground beef to test their product regularly before and after grinding. If testing discovers contamination, the bill would require the affected product be disposed of or cooked to a temperature that destroys the pathogen. Ever wonder that nobody ever mentions irradiation anymore?

Also in the news for the month is more about JBS buying a majority equity stake in Pilgrims Pride. And the good news, bad news from the export market; exports of beef and beef variety meats remain below last year at the same time, but the weaker dollar is expected to move more product while Taiwan has agreed to accept bone-in beef from the U.S. and a recent survey by USMEF in Japan suggests that the Japanese are becoming less and less concerned about the safety of U.S. beef.

In the feed yards, after apparently moving through larger front end supplies because of earlier, curtailed kill levels, weathering heavier carcass weights, lower cut out values, unsupportive and lower futures, and facing plenty of excess pork supplies, fed prices that held their own in September, fell out of bed the first two weeks before rebounding with the support of rising cut out values and supportive futures the latter part of the month.

At the markets, runs were moderately light to moderately heaving depending on where the most rain was at the time. Slaughter cow numbers moderated and not near as many were sold as the previous two months. The better quality, lighter weight turn out kinds fared a little better than the heavier weight calves as calf prices rebounded from the previous month. Cows and bulls pretty much traded sideways for the month.

Plenty of porkers on the market, poultry also, as well as beef but the cold storage report about the third week of the month indicated less of all in cold storage than the previous year. Maybe we’re eating it faster than we thought.

November is here and it’s still green from Texas across the South. Maybe we’ll keep the cold to the north and be spared a frost for a little while. It wouldn’t hurt most folks feelings.

SEPTEMBER OVER MY SHOULDER

Little news came out of Washington if it didn’t start with health care or environment, or cap and trade. There was what most are calling a positive change in leadership of the Senate Agriculture Committee as Tom Harkin left the committee to become Chairman of the Senate Health, Education, Labor and Pensions Committee. The new Chairman for the Senate Ag Committee is Blanche Lincoln of Arkansas. Lincoln becomes the first woman ever to chair the Ag Committee. She is the daughter of a farmer, and brings a wealth of ag knowledge to her new job. She is considered by many to be a good fit for production agriculture. News from the export front from the US Meat Export Federation during the first seven months of the year shows a 6 percent drop in volume of beef and beef variety meats and a ten percent drop in total value. The sluggish world economy is mostly to blame and is not expected to resurrect itself overnight.

Meanwhile in the feedyards, fed cattle for the month, that were expected to run out of the heavy weights, and show price improvement, and stay in front of the futures, had a tough time staying mostly even for the month. The month began with most cattle selling $84.50-$85.00 and ended with about the same figures. During the month, futures became unsupportive for any increases as well as low priced beef trimmings and lower trending drop values. Some think the market did well in staying even for the month.

In the county and at the markets, calf runs saw moderately large numbers in the drier areas until there was enough moisture in most areas to slow it all down for the last two weeks. Cow numbers followed calf numbers as first of month in the drier areas saw larger numbers of cows before cooling off later in the month. Calf prices showed a slight increase after Labor Day before backing down some $4.00-$5.00 at mid month and finished that way. The wheat boys who intend to graze significantly more wheat than the past two years are a month closer to grazing than usual because of excellent moisture in the grazing areas. On a practical basis, the four weight steers sold mid to high nineties to over a dollar, while the five weights sold low to mid nineties. The very best utility cows sold in the low to mid fifties.

In the meantime, the pork complex that is in serious trouble was looking at kill levels of well over two million head each week with the top weight barrows and gilts selling in the mid thirties.

We have a good start to the fall with moisture for a change. Day time and night time temperatures are warm but not excessive and should allow us to grow more grass with continuing moisture. It won’t bother me if we don’t see a frost till after the first of the year.

END

AUGUST OVER MY SHOULDER

August is gone and was full of market and ag news, short on political news out of Washington, and long on health care talk in home districts while the House and Senate were on their summer breaks. Weather beginning the month was a repeat of July till a few showers and slightly lower temperatures began to creep into the daily picture about mid month.

Unsettled weather during the second half of the month produced weak frontal activity that brought scattered showers and rain activity. While the rainy periods and activity was good on those that received it, not much was done to alleviate the overall drought picture. After nearly three months of almost no activity, some moisture in a good many areas was certainly a change. Two or three inches of rain at one time or an inch twice or three times can sure make a difference if you’re lucky enough to get it.

In the meantime, many of those who haven’t sold all or most of their cows steadily purchased and hauled hay from the north and east into the areas that have made limited amounts of hay, to either feed now or this winter.

There didn’t seem to be much news out of Washington except for the usual monthly reports of COF, the August Crop Production report that USDA is calling the second largest corn crop in history, reports that indicate beef, pork, and poultry production has declined, is declining and will continue declining through 2010. With fewer cattle, hogs, and poultry on feed, with a reduced corn demand from ethanol and exports, the University of Missouri’s Food and Agricultural Policy Research Institute (FAPRI) issued a report that projects corn prices for the 2009/2010 marketing year to average $3.47/bu. By the end of the 2014/2015 marketing year FAPRI believes that corn will rise to $3.98/bu. In the meantime, at the first of the month the (dairy) Cooperatives Working Together accepted a total of 86,710 cows for their ninth “dairy buyout” and second of this summer. The current buyout got underway during the month of August.

In the feedyards, ready supplies that were expected to really tighten up at first of month didn’t do so till the end of the month. The month started with the first week showing a dollar loss in the fed market, saw it put back the second week and by end of the month saw the market add another $3.00 to close at $85.00 on increased volumes. The experts were saying that the packer’s push indicated a need for cattle during the shortened labor day week, with strong beef orders and recognition of tightening supplies.

Meanwhile at the market, the “normal rainfall areas” saw seasonal increases in calf numbers and only moderated slaughter cow numbers while the drier areas saw increases in calves and cows as many producers began to take stock of available feed supplies. For the most part the calf trade saw strength throughout the month as grain prices, even plowing and sowing of grazing wheat in some areas was conducive to growing calves in the lots or later on grass. By end of month a little downward pressure was felt on the calves, partially due to the nearness to Labor Day as much as anything else. End of month saw the better six weight steers near a dollar, the five weights at it and over and the better four weights over the dollar.

Slaughter cows and bulls by end of month advanced slightly to see a few high yielding cows over the $50.00 mark, with the cutter cows trading $38.00-$44.00. A good bull at $58.50 and some high yielders well over $60.00.

Pork and poultry remained low priced and a thorn in the side of beef at the meat counter.

Maybe summer has ended and we’ll see a change in weather. Some good early fall rains and lower day and night time temperatures would be welcomed.

END

JULY OVER MY SHOULDER

July started and ended just about like every month so far this year. Weather in Texas being a typical mixed bag, mostly warmer than usual with some having adequate moisture while others had nothing. Weather across the country has been the same situation except that excessive moisture has hurt some about as bad as excessive dry here at home. Live markets seemed to be higher most of the time than what conditions seem to warrant while red meat production is up and domestic and export demand is faltering. The economy, considerable activity in the halls of congress, and other distractions seemed to be in the news every day and occupy considerable time and thought from all Americans.

July weather in Texas saw more frontal activity than usual that seemed to exclude the vast majority of central and south Texas while the panhandle, northern parts, and East Texas ended the month wet in many cases and in good shape in others. At end of month, 32 million acres or 18.7% of Texas was considered to be in “exceptional drought”, the most critical drought stage. In that area, crop production is almost non existent and liquidation of cow herds have or will take place if no moisture arrives quickly. Some have said that a saving grace to the state is that ample hay production has taken place in many areas and if hay is to move North to South, at least it will require a shorter haul than usual. Along with the lack of moisture has been record setting low and high temperatures in the country. Without thinking, we all know where the record high temperatures have been.

The fed market reflected a lessening in demand throughout the month and ended the month at the $82.00 level in Texas about where it started. Competitive meats and shifts in beef demand from less eating out and more purchases at the grocery store has taken demand pressure off of middle meats and put it on the end meats. One saving grace to the fed market is that offal credits have risen 43% from March to July, being worth about $2.43/cwt on the fed cattle. With lowering grain prices, fewer available feeder cattle have maintained a good demand both in the yearling and the calf trade.

On the political front, NAIS saw little or no activity after the house rejected funding for it and the senate as well. Late month the house passed the Food Safety Enhancement Act of 2009. The bill provides for FDA to have an expanding role in food safety. At least, our ag lobby was able to remove many of the very objectionable parts of the bill including giving FDA authority for “on farm” inspection of livestock. Late month saw members of the house Ways and Means Committee petition the US Trade Rep to seek agreements with Japan to expand the present 20 month old rule on cattle to include beef from older cattle.

The Congress tackled other, bigger fish, and some say that it might be a good thing that they’ll be on vacation for the month of August.

Lastly for this month; The study that received widespread front page coverage for several weeks two years ago that linked red meat with cancer has now made the back pages as the authors acknowledge that mistakes were made in the report. Such is our lot in life.

In the country, many areas experienced the premature selling of calves and culling of cows because of dry conditions while other areas did not experience anything other than the routine marketings of ready calves. For the most part, the calf trade held steady, firm, higher for the month while cows and bulls were mostly steady-stronger, then weaker after moving through big kill numbers at the first of the month. Dairy buyout Number Eight by the cooperative for cooperatives is supposed to take place sometime in August.

Continuation of rainy activities at the end of the month will certainly be appreciated if it doesn’t rain straight down for a month. Any moisture is better than no moisture even if all is does is remind us that it does come from above. Cooler temperatures wouldn’t hurt anyone’s feelings also. Maybe August will be the last of the extreme temperature. Come on August.

JUNE Over My Shoulder

The first half of the year has now come and gone without very many ag problems solved or much better moisture conditions than the way we started the new year. Weather during the month of June seemed to be patently unkind to most of Texas, and particularly the southern half. Political and economic uncertainty continued to dominate our everyday thinking, with concerns for near markets and what they’ll look like in a few months.

For the month of June, the big, big concern was once again the weather. A cool, dry May and a miserably hot, dry June combined to be the lowest rainfall May and June ever in the Houston area while June ended the month as the hottest on record. In the meantime, northern and northeastern areas of the country, continued their very cool and above average rainfall amounts to the point that crop plantings that are normally over by the first of June extended well into June in those areas. Major concerns began to pop up about the corn crop with delayed plantings maybe being diverted to soybeans, or the late planted corn having lower yields. It’s probably not going to make much difference about how big the corn crop is with year to date exports down 32%, 4%fewer cattle on feed, 7% fewer chickens, and potentially a big time drop in hogs on feed. Corn demand from the ethanol boys could be less, as they are having their difficulties right along with their bio diesel buddies. No one knows what the final overall demand on the corn inventory will end up being or what the pricing picture will look like.

June was eventful for other activities in the Ag sector. Politically, on the big stage, we heard plenty about us being in the car and banking business and watched the House pass the Climate Change Bill that some were calling a jobs bill. The Senate still has to consider the climate change situation. The big news for us cow guys was that the House Ag Committee’s Sub Committee on Finance removed all funding for the National Animal Identification System that in effect will send the ID program back to the drawing board.

The ongoing dairy buyout will remove nearly 103,000 dairy cows and put them on the market for ninety days got underway at the first of June. There has even been talk about pork producers banning together to eliminate a large number of sows to regulate numbers and improve prices. Good luck boys. On the animal health front, Texas confirmed a case of Tuberculosis in a West Texas dairy herd that animal health officials will focus on. Texas’ TB Free accreditation will be in jeopardy if the herd is not depopulated and another case is found within 48 months. Early in the month a case of Vesicular Stomatitis in a horse in Starr County and another in New Mexico prompting many states to put restrictions on horse movements from Texas and New Mexico.

Market wise, in the feedyards, fed cattle that started the month about $2.00 lower than the end of May, held fairly steady as ready numbers throughout the month traded sideways and finished the month as it started in the $82.00 range. Carcass cut outs for the month traded in a narrow range as the choice cattle traded $139.00-$140.00 and the select cattle some $6.00-7.00 behind.

At the markets, in the areas that seemed to get limited moisture market runs remained seasonal and in the areas where no moisture fell, folks began to take defensive measures by selling a few more cows and pulling a few more calves earlier and lighter than usual. Calf numbers did not become burdensome but any cows sold, for most of the month had to wait a few days before they went to the plants. Calf prices for the month took some lumps as numbers picked up and the bigger they were the bigger the lump. Slaughter cow and bulls for the month lost $7-8.00 and at end of the month bounced back $2.00-$3.00 as packers were building inventory for the last few days of the month.

The pork complex continued its sufferings as hog kills stayed above the two million head per week level. The hog boys are feeling a big time economic punch.

Most areas of the state of Texas are in some degree of dryness with a large area on the critical lists. No moisture and no relief from the temperatures of the past month will spell disaster and the inability of many folks to provide for the cattle still left in the pasture. A lot of folks will be forced into more gut wrenching decisions about how to manage around or through the rest of the hot, dry summer. We’ve been pulled out of the fire before with July rains, let hope for the usually unexpected rains that can come in July.

MAY Over My Shoulder

May, the last of the spring months is gone and was good on some and not so good on others. Some areas received good moisture during the month, some did not. On the market side, some news was good, some was not.. On the political side, some was good, some was not. What’s different?, May was a usual kind of month, full of good and the not so good.

May probably saw more cloudy days during the month than sunshine, and put down a good bit of moisture in some areas and didn’t put it down in other areas. The central and eastern part of the state seemed to get more than other areas, while west and south Texas continued needing moisture badly. Even the areas that did receive the rain ended the month needing more to keep crops as well as pasture grasses thriving. Can we ever get too much in the month of May? By the end of May, plenty of spring growth hay had been made despite a slow growing start in most areas due to the cooler nights at the first of the month.

In the market place, we saw sideway movements in the fed complex and saw a huge bomb dropped on the pork complex due to its perceived identity with h1n1 flu, alias swine flu. By month’s end another bomb was dropped on cowboys as the market place began to gear up to handle the increased numbers of slaughter cows that will be coming in the next dairy buyout.

On the political side, the economy, fighting wars, nucs and rockets, and additions to the Supreme Court dominated the news. On the ag side, the dairy herd buyout, Canada with their 16^th case of BSE, and Japan with twenty some odd cases of BSE receiving a “Controlled Risk Status” from the OIE and the US with two cases and umpteen times the number of cows has to beg for a “negligible risk status” from OIE. But the big, big item on the political front for most cowboys is current considerations concerning the National Animal Identification System (NAIS). There are those in congress who are pressing for a 48 hour trace back program while the Secretary of Agriculture is conducting “listening sessions” in various parts of the country.The big question is, should we have a voluntary or mandatory program, should we have a book end system, or a full fledged 48 hour trace back program, and how much will it cost, and who will pay for it, and is it worth it?

In the market place, the industry pacesetter fed cattle market saw weakness throughout the month as an $86 dollar market at the first of month turned into a $84.00 market at the end. Movement was curtailed by packers that were still controlling harvest levels each week and by months end began to back up and cause a larger than ordinary carry over of ready cattle at month end.

Meanwhile in the county, calf and cow runs during May were hampered in some areas by rainy conditions and slowed down. By month’s end, the calf trade remained brisk on moderate numbers and the cow and bull trade began feeling the effects of the Dairy Buyout that was set to begin. Calf prices ended stronger than they started by several dollars while the cows and bulls lost four to five bucks live.

In the pork complex, the erroneous association of the industry with the world wide flu bug, made many shy away from eating pork both at home and aboard and the industry suffered the ill effects of the association.

It will get seasonally warmer as we progress into June, let’s hope that we continue to experience the unsettled weather that can create moisture as there is still a great need for those who have not had any to get it and for those who have had it, to keep getting more.

April Over My Shoulder

Our beginning of the month wish for the rains to continue came to be, as most of the month of April was punctuated with unsettled weather that produced much needed moisture over most of the state. April markets showed strength because of moisture and shorter fed cattle numbers while beef demand held its own in the grocery store. April was an active month as our own legislature was in full session and those in Washington were/are still posturing for stimulus money or to push their favorite agenda.

Most areas of the state received more than one rain or rainy period that filled stock tanks, as moisture from the heavens fell on scorched earth and grass to make for a month and period where we might be getting back on track with spring moisture. The weather guys have been saying that we’re moving to a wetter El Nino pattern and should be there by June. Halleluiah.

In its usual slow way the Texas Legislature is muddling through another biennial session and considering many items of interest to cowboys and land owners; eminent domain, new cattle theft laws, capping oil wells, water bills, and others are being hammered out. Animal health news in our own state is on the stove top with a West Texas dairy TB cow, the beginning of our own trich program, and fever tick concerns over a larger and larger area in South Texas.

On the national scene, with a changing of the guard we’re seeing new food safety concerns, as others are concerned with clean water, clean air, endangered species, animal rights and more. Secretary of Agriculture Vilsack conducted a hearing and heard from the industry about the National Animal Identification System (NAIS) in Washington and has scheduled several listening conferences over cattle country with one meeting scheduled for late May in Austin. The green folks are pushing agendas as USDA will conduct its first ever, wide scale survey of organic farming in the US; its intention will be to assess how the growth of organic farming is changing the face of US Ag.

On the international scene, Canada is continuing with its WTO complaint over our Country of Origin Labeling regulations (COOL).

On the scientific front, the long running $56 million project of a consortium of Baylor, Texas A & M, the State, and many cattle groups including check off research dollars from Texas, announced the completion of and publication of work involving the genome of domestic cattle. The project sequenced and analyzed the genetic blue print of the Hereford breed and is considered a monumental break-through in understanding cattle genetics.

Back to the markets; in the feed yards, fed cattle that began the month with an upswing to an $83.00 top, advanced to the $88.00 level before backing off the last week of the month to end at the $86.00 level. Throughout the month, packers tried to limit weekly kills, backed up a few cattle, and caused concerns with feeders. Lighter carcass weights, continued beef movement, and moving through a slight backlog of ready cattle might be made easier as we enter the grilling time of the year.

At the markets, with good March and April rains, cow and calf runs slowed, partly because of a new lease on life as well as folks simply not working during the rainy periods and making lots even muddier. The slaughter cow and bull market as well as calf markets remained strong and continued an upward push as numbers backed off and demand picked up. Top cows moved to the mid to high fifties, the bulls to the mid sixties; while the light weight calves moved well into the dollar something, and the five-six weights moved over the dollar bill on the better cattle.

In the competing meat complex, pork production is still over two million head a week and holding in the $40.00 range while poultry production is down. Both still provide plenty of completion and choices in the meat case.

It seems that most of our ills go away when there is adequate moisture to grow grass and have a normal year. Let’s hope that we continue receiving moisture and can catch up on ground water, grow grass, make hay, and raise big calves. Come on May.

March Over My Shoulder

March has come, left its mark, and the first of the spring months flew by in a hurry. March at mid month finally saw some almost state wide moisture for the first time in months and months and then had another round of it towards the end of the month. No area got all the moisture that it needed but at least it was a start to perhaps a changing weather pattern that might see some more activity as we move along. The Midwest, particularly in the upper portions, saw a good bit of the kind of weather activity that they didn’t need or want while some of the fronts that skirted Texas and moved off to the East and South, in some cases gave them more than what they needed or wanted.

While we were waiting on the fronts and the moisture that they brought with them we seemed to wait on the markets to do something also. At first of the month a good many folks simply ran out of waiting time and began to sell some thinner, older, distressed cows along with their babies or small calves. The rains at mid month slowed this procedure down and triggered an upturn in the calf market as well as the slaughter cow trade.

On the political front there was plenty to observe as the new administration started putting together the economic stimulus package and then started some of their other programs that might enlighten us to the rest of their agenda. It seems like their agenda will be dramatically different from the past and only time will tell if they can get it done like they might envision it. In the ag sector, there seems to be a good many confusing signals coming from the administration, USDA, and a good many individual lawmakers. Agriculture trade, NAFTA, CAFTA, MCOOL, NAID, horse slaughter and transportation, food inspection, payment limits, restrictions on use of antibiotics in food animals, you name it, have all come under scrutiny and who ever has an ax to grind or an ox to gore has expressed their opinions on their favorite subject and have either filed a bill or want changes to existing programs.

Meanwhile, in the feedyards, fed cattle that began the month at the $80.00 level had worked up to end the month with most cattle trading at $83.00. Through mid March, total beef production was up 1.7%, while cut out values that averaged $138.30 is down 5% from a year ago. Beef in storage is down from last year meaning we ate it, and this coupled with slightly more production mentioned above means that total expenditures on beef so far for the year is 100.3% of last year. Consumption patterns are changing as restaurant sales are down, retail sales are up, middle meat demand is less and end meat demand is up. The good news is that overall, total beef demand is holding its own in the face of the ailing economy!!!!

At the markets, with a very dry January and February, many folks had to give up the ghost, as they ran out of stock water and hay supplies and began to sell a good many cattle in the drier central and western areas. Mid month and end of month rains over a general area slowed these movements down and at the same time spurred some grazing of wheat, oats, and rye grass in the grazing areas. Fewer calves and butcher cows on the market gave way to an increase in selling prices as the calves generally put on $6.00-$8.00 on the heavier weight calves and a lot more on the light weights. Cows on a live basis saw some price leaps and saw some better cows to the mid fifties to near sixty and better bulls to mid sixties, near seventy depending on where they were.

There are still plentiful top weight barrows and gilts on the market as the hog kill stays over the two million head per week number. Hogs basically sell in the low to mid forties and provide plenty of competition to beef in the meat counter.

March got the rains started, let’s hope that April continues the trend. The scientists are saying that the drier La Nina is moving out and the wetter El Nino is moving into Pacific waters. It can’t be soon enough to maybe reverse the trends of the past. In the mean time, we’ll need more moisture to keep the crop boys going and the grass growing to be able to take care of the cattle that are left. First things first, let’s take care of what we have and then maybe we’ll worry about what might be happening to the minds of our lawmakers and others.

February Over My Shoulder

February is now gone and most of the State of Texas is as dry at the end of the month as when it all started. Little meaningful moisture was once again the fortune of the state. Most of the live livestock markets struggled throughout the month, while much went on in state houses around the nation and in Washington as the political year started unfolding.

Weather and or the lack of it is dominating, has dominated, and will continue to dominate the thinking of cowboys and farmboys. If we’re cowboys, it’s time to see things turn around, gather a little moisture to have a spring and if you’re a farm boy, you want to see moisture to put in and grow a crop. Now is better than later, tomorrow is better than the day after tomorrow. What weather makers we have seen, seem to not materialize or slide right by us and go south and east where conditions are not only improved but certainly better than their brethren back to the west.

On the national political scene, much has transpired with our economy and attempts to fix it and there is a new administration gearing up. We’ll probably hear about a lot of things that might go on that we won’t or don’t approve of but until it is acted on and put into law or rule, it’ll be only talk. There’s plenty of talk about NAFTA, COOL, NAIS, CAFO’s, and whatever else you might think of. Suffice to say, we’ll see a new approach to a lot of what goes on in our business; if one has opinions on a subject, one should make it known to those we have elected.

Of particular importance to a lot of us, is the movement in many states to oppose a ban or movement of horses to other countries for processing. It has been reported that several states have passed non-binding resolutions opposing federal legislation that would ban these practices and/or transport. There are efforts in four state legislatures to reopen horse processing plants in Arkansas, Illinois, Missouri, and Montana. It seem that the unintended consequences of banning horse processing is now rearing its ugly head and getting the attention of a lot of folks.

In other news out of Washington, the Justice Department successfully blocked JBS Swift from acquiring National Beef Packing Co. as part of their other recent acquisitions of the Smithfield Beef Group and its subsidiary Five Rivers Cattle Feeding Company. The Justice Department reportedly cited concerns about diminished competition in the packing industry as their objections. On a similar, familiar, note, Smithfield, the world’s largest pork producer/processor has recently announced the closing of several plants and the elimination of 1800 jobs.

Needless to say, in our struggling economy, with new folks at the helm, and changing world conditions, we’ll have a lot more news in the coming months to listen to, observe, and act upon.

In the market place fed cattle that began the month with a struggling $82.00 market ended the month struggling to stay above the $80.00 level. In the country and at our livestock markets, numbers have been seasonal and perhaps slightly above normal but not particularly over burdening and probably won’t unless and until we see a situation where we have no spring. There are some that say that calf pricing levels are higher than they should be but they keep right on giving the money. For the month, calf prices were more or less steady while slaughter cows and bulls made up a higher percentage of total numbers and lost ground in the market place after starting higher at the first of the month.

There’s plenty to get straight in our economy, there’s plenty to get straight in agriculture, there’s plenty to get straight everywhere we turn, but the thing that needs to straighten up first, the fastest, now is a changing weather pattern that will put some moisture down from the Southwest into to Texas. There’s an awful big agriculture production area that needs moisture before we can tackle or face up to other important issues. I’ll bet it works out, somehow, it usually does. Come on new month.

January Over My Shoulder

What a way to start a new year; modern day cowboys aren’t used to this; everything gone awry in a hand basket during the month of January. No rain here, no rain there, not a drop of moisture anywhere was mostly the tune for the month no matter where you were. Right along with no moisture, was a perceived no support in the meat case that was translated to the fed market with lower prices throughout the month and to a flat yearling trade and a calf trade that struggled out of the starting gate to begin the year. Continuing economic woes have and will plague us for a long time to come as there will be no quick, painless answers as our nation’s leaders attempt to right the ship.

Dry weather conditions of the past few months have left us with limited top moisture and has cumulatively taken its toll in terms of no or limited sub moisture. We’ll be hand to mouth with any moisture that we might start getting in the next month or two. In many areas limited moisture in January makes it easier to winter a cow but when it’s as dry as it has been, moisture would have been welcomed just to make folks feel that it does still know how to rain. It would also have been good for the planted winter grasses and clover where it’ll grow.

January was obviously an eventful month in our nation as we inaugurated a new president and swore in new cabinet members and immediately began measures to shore up our ailing economy. Time will tell as to how effective and how fast we’ll heal. In the meantime, much that affects agriculture took place as the new Secretary of Agriculture assumed his post and identified some of his top priorities, talk of an another impending dairy buyout surfaced in the Economic Stimulus Package but later vanished, COOL was delayed by Executive Order of the President, and the JBS hearings were once again postponed by the Justice Department. Late in the month, the Cattleman’s Beef Board by an overwhelming majority recommended changes in the Check Off Program to USDA.

In the feedyards, the month started in the mid eighties and by end of month worked itself down to the $82.00 level amid talk and belief that beef demand was in a serious decline. Most analyst no doubt say that beef demand in the restaurants has taken a hit, but data suggests that during January, total volume and cutouts are ahead of last year as well as total beef expenditures. While combined values of the rib and loin are lower than last year, all other primals plus trimmings are a good deal higher. We certainly need to hold our own at the grocery store in the face of lower priced competitive meats.

At the markets, increased seasonal marketings occurred as a good many calves were sold that had been carried over as well as drought related sales of brood cows. For the most part, the carry over calves were of good quality and sold on a slightly higher market than what we saw during the fall. Not all, but some of the lighter weight cattle put on as much as $15-$20.00 while some of the heavier weight cattle put on $8.00-$10.00. Not all calves and yearlings participated in the up market as buyers remained as selective as ever. Most of the cows that came to town were lacking flesh; some were weak as well as thin, and sold on a market that sent them to the packing plant as only a few cows went back to the country.

Pork and poultry supplies will remain large and be lower priced than our beef. Slaughter numbers of hogs remain substantially over the two and a quarter million figure for each week of the month. They seem to never quit coming.

January is gone and if you’ll look around there seems to be a good many more calves on the ground a little earlier than usual. Meet with some cowboys and you’ll find that weather is on their minds, meet with some farmboys and you’ll find weather on their minds too. Meaningful moisture is certainly needed and can’t come quick enough for farmboys and cowboys alike.