In today’s Beef Buzz, Senior Farm and Ranch Broadcaster Ron Hays speaks with livestock market economist dr Derrell Peel. Cattle markets remain exceptionally strong, fueled by supply shortages and shifting marketing decisions. As Dr. Derrell Peel explained, “this is all about tight cattle supplies.” He noted that the fall run is underway with “a lot of unweaned calves coming to town,” but demand is uneven as buyers remain focused on wheat planting. “Right now, everybody’s busy planting wheat instead of buying stocker calves,” Peel said.
Peel highlighted how producers moved calves earlier than normal to capture high prices. “Surprisingly, in Oklahoma, auction totals were up around 20% on a year-over-year basis,” he pointed out. While Missouri also saw increases, “Kansas, not so much. So it’s maybe more of a regional thing to some extent.” He added that fall runs are still expected but lighter than last year, which “is likely to keep our support for these markets pretty good, with less seasonal pressure on these markets in general.”
Preconditioning remains a crucial issue as more unweaned calves enter the market. Peel emphasized its value, saying, “we have data that shows that even in record high prices, preconditioning pays, still the premiums will be there.” From a buyer’s standpoint, “the health risks are tremendous, and the amount of dollars that you risk if that calf gets sick or dies is tremendous.” Still, Peel acknowledged the producer’s perspective, adding, “I can’t really fault producers the total dollars per head here is something we’ve not ever seen before.”
Peel underscored concerns about herd rebuilding. “We just don’t see any indication of much heifer retention at this point,” he warned. Without retaining replacements, “we’re going to extend the timeline on this situation that we’re in another year. We’ve already extended it, I would argue, at least a year from when we could have started some heifer retention and potential herd rebuilding.” If it doesn’t happen in the fourth quarter, “then we’re going to put it off another year.”
Finally, Peel reflected on the broader supply trends confirmed by the latest cattle on feed report. “This September report would be the ninth consecutive month that we have had a year over year decrease in feedlot inventories,” he explained. While each decline has been modest, “pretty soon it’s a compounding thing it won’t be very long till it will start accelerating.” He concluded that the trend “reflects the overall tighter feeder supplies that exist out in the country.”
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Ag Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
