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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 across Texas.
March Over
My Shoulder
March is in the record book and will be remembered mostly as a month
of record highs and maybe even some lows. Weather was either good
or bad; no rain or excessive rain, and plenty of wind to rob what
ever moisture that did come. At month’s end, the farm boys were
looking for top moisture and cowboys were looking for any kind of
moisture to keep spring grasses going.
Markets, to
say the least have turned volatile with no regard to any kind of
historical perspective as we seem to be plowing new ground in all
that we do. Crude oil or vegetable oils, feed, food, or ethanol
grains, pork, poultry, or beef, a crippled stock market, a sagging
economy, are all searching for their place in the new order that
seems to be coming on us. Agriculture’s woes begin with escalating
energy costs that to say the least has dramatically impacted
production costs that doesn’t get passed along to the consuming
public who is being hammered by the very same escalating energy
costs.
We seem to
not hear much on the political scene as all else is overshadowed by
the presidential race. March saw so resolving of the ’07 Farm Bill
as no head way was made between Senate and House versions. It’s
being debated to simply extend the 04 Farm Bill; it’s probably not a
totally bad thing, except that the new bill does make a mandatory
COOL more palatable compared to the ’04 mandatory COOL version. Not
much headway was made on the Korean or Japanese trade fronts, except
promises of new governments who are supposedly receptive to talking.
One political
issue that was resolved by tough politics that was highly applauded
was an action by our own Texas Commissioner of Agriculture. It
seems that the same Mexican government that still had not opened up
to importing beef cattle from the U.S. was willing and actually
signed an agreement with Canada to take beef cattle. Our
Commissioner put his foot down and said maybe so, but they’ll not
pass through the State of Texas export facilities, operated by The
Texas Department of Agriculture. He then lined up New Mexico,
Arizona, and California and they said no. In just a matter of a few
days, Mexico lifted their hold on exports and opened their borders
to U. S. cattle. Hooray for Todd Staples, our Commissioner of
Agriculture.
Closer to home and in the feedyards where our live cattle action
begins, it was tough sledding as fed cattle that began the month at
$93.00 slowly made its way to a close of $88.00 at month’s end.
Retail beef competing with low priced pork and poultry has had its
effects as packers have had difficulties moving beef at high enough
levels to keep themselves in the black much less the folks that have
been feeding them. Interesting phenomenons occur along the way,
with the highest costs of feedlots gains ever, we’re feeding them
longer and increasing carcass weights; the choice-select spread is
as narrow as its ever been; and plenty of folks still have found no
solutions to our dilemmas.
At the
markets it’s still being sorted out just as it is in the feedyards.
Market runs of cows and calves during the month were typically
seasonally light in numbers. Rain in some areas curtailed numbers
but middle of month on saw folks working like they wanted.
Uncertainty crept into the pricing mechanisms as from first of month
to last, calf and yearling prices drifted downward to end the month
dollars lower. At end of month a good five hundred pound steer calf
struggled to get over a $110.00, while the six weights fought to
stay over the dollar mark. Slaughter cows and bulls ran into the
same snag as the fed cattle as they lost $3.00-$4.00 from first of
month till last.
The hog boys
are now facing more hogs than any time in history. Large numbers
have pressured prices that got as lows as the middle thirties while
liquidated sows sold from $10.00 up. Pork is a big nemesis to beef
in the meat case.
There is
plenty to be sorted out in our industry. Not much sorting can be
done without a good spring that leads to a good grass year. We’re
sure nuff be in the grass growing mode during the month of April and
it would sure nuff be nice to get more than enough moisture to cover
our needs. Is that not our concern during most Aprils of late?
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