The Enid News and Eagle, Enid, OK

September 29, 2012

Prices continue to hold at NW Okla. livestock auctions

Staff and wire reports
Enid News and Eagle

ENID, Okla. — Staff and wire reports

Officials say Oklahoma cattle markets endured a second consecutive hot summer fairly well.

Better-than-average prices are expected through the fall and winter — if the stock gets plenty to drink, and if producers can afford feed.

Derrell S. Peel, agriculture economist at Oklahoma State University, said due to last year’s drought, a number of cattle were culled, which kept the size of the herds below average levels.

The hay supply seems to be in fair shape, but Peel is concerned about the status of water in the persistent dry conditions and the inflated costs of feeds originating from drought-stricken areas.

“We may see a little more culling (of herds) than there has been this year,” he said. That will reduce those herd numbers and keep prices up in the fall and winter.

Jerry Nine, owner of Woodward Livestock Auction, said this year got started with a wet spring before the rain tapered off.

“But the markets are good,” he said.

Nine said he expects markets will continue on the positive side, especially if some rain comes this fall to help pasture lands and get winter wheat going for cattle grazing.

He said a limited supply of feeder cattle, with the dry conditions forcing them to go to feedlots sooner, will affect the market supply and thus hold prices up this fall and winter.

“The drought is everywhere,” Nine said. “Wyoming, Nebraska, North and South Dakota, Missouri and Arkansas conditions have led to many of the cattle going to the feedlots” instead of to market.

Weston Winter, of Winter Livestock, said in a report released Sept. 20, demand for stocker cattle remains good.

“Maybe it is the lull before the storm, but there still seems to be plenty of folks willing to tackle calves and get them ready for whatever winter pasture might be available,” he said. “Of course, the feed yards also stay bullish, with fewer feeder cattle available and higher costs of gain.”

Marlin Trissell, Woodward-area cattle rancher, said prices over the summer were above last year’s, and he expects them to be good and perhaps even increase during the fall and winter.

“Last year, we had the drought heading into the summer,” he said. “This year, we had a relatively wet spring.”

As a result of conditions last year heading into 2012, “most people did not expand, or build, their herds,” Trissell said.

He said supply-and-demand factors intervened to put prices mostly above the 2011 results this summer.

To prepare for the rest of this year, Trissell said producers are going to have to adjust their herd numbers again for the return of dry conditions, perhaps through culling them, and for the inflated cost of feed grains.

“Corn and soybeans are $4 to $6 higher per hundredweight than last year,” he said.

Trissell said he expects the positive supply-and-demand effects to continue for cattlemen, with the smaller herd sizes continuing on the supply side and healthy desire maintained at the grocery store.

“I’ve seen some rib eyes at $10 a pound,” he said. “Now, if they go to $20, (shoppers) may turn to chicken or pork.”

Associate Editor Kevin Hassler contributed to this story by Gary Engel of the Woodward News.