LOOKING UP marketers optimistic following long winter and late grass growth

by Managing Editor Stevie Ipsen

If there is anything California cattle producers know, it is to expect the unexpected. Following years of persistent drought and worries that without a good winter, making it another summer would be nearly impossible, residents’ prayers were answered with something they desperately needed – moisture...then more rain and more snow, until some prayers for moisture turned to prayers that the moisture would stop. With rangelands more adequately charged than they had been in the better part of a decade and live cattle prices predicted to continue to rise throughout 2023, beef producers across the west were smiling. But like the usual ebb and flow of the ranching climate the early excitement for a great spring marketing season were put on hold as mother nature’s cool temperatures persisted much later than California is typically known for. Now that the grass has gotten it’s growth, we contacted auction managers and marketing minds in various regions of California to see what 2023 marketing looks like in their respective areas of the Golden State.

Randy Baxley

Visalia

Livestock Market

RoundupCattle.com

South Central California

REGIONAL WEATHER:

It’s no secret we had a wet winter. We’ve been waiting for one for a few years but in a lot of ways this one gave us more than we could handle. With down fences, washed out roads, it set guys back quite a bit. In most of February when we usually see grass start to come on, we were still seeing nighttime lows in the 30s. Once it warmed up, it seemed like the grass grew a foot a day. It put us about 30 days behind on marketing. At the time we were normally having our second big sale, we were just getting the first of the sale calves delivered. Now we are in a bit of a catch 22 situation because after such deep inventory cuts last year and so much feed, there are less cattle to handle all this grass. Less cattle is also what has led to the high market.

MARKET INSIGHT:

So far, 2023 prices have been great. I am of the belief we will see the market soften as the heat comes later in the summer. Last year good prices lasted through the summer but that isn’t typical. I think it will still be really good but not as record-breaking as we are seeing in early May. The heat risk of delivering calves to the midwest in the heart of summer usually leaves buyers less aggressive. Even with the low inventory we have now, I think we will see some of that. For me, the moral of the story is if you have 650 pound calves, I see zero reason to wait for them to weigh 750 pounds before selling them. You will probably make the same in the end. I also advise buyers to always invest in good, balanced genetics and good vaccination programs. Not only are you setting your operation up for more success in the future, you are also setting yourself up to fetch the best prices the market will allow, even down the road when prices aren’t this high.

JIM WARREN

101 Livestock Market

Central Coast California

REGIONAL WEATHER:

After the last few years we really needed some rain and we were fortunate to get quite a bit of rain over the winter. It also stayed cold though so the grass took a while to come on. Ranchers fed every bit of hay knowing the grass would start growing any minute. It has finally taken off and we have a lot of feed.

MARKET INSIGHT:

We saw a lot of cattle liquidated last year due to drought. Not just in California, but all over the country. With inventory so low, the market should be good no matter what, and the operations that have cattle left to sell should be in good shape. I’m exceptionally optimistic for the programmed cattle that are double backed with good genetics. They should fetch a premium any time but in a good market they should do really well.

MAX OLVERA

Turlock Livestock Auction Yard

Central California

REGIONAL WEATHER:

Turlock Livestock Auction

Yard customers cover a large swath of Central California, the Bay Area and the Sierra Foothills and by in large, our customer base had a great winter. When we get a good winter like that it is typical for the spring grass to get a slow startIn some areas it was too wet, which is a rarity here in California. But now that it has dried out and warmed up we should see some good feed to come back to later in the season.

MARKET INSIGHT:

I can’t say enough how happy I am for livestock producers right now. It’s not very often that we see a great grass year and a great market at the same time. I’ve suspected the market would be good but I have underestimated it. We are seeing a demand for cattle of all classes of cattle. The competitive bidding process is really something to behold right. The right buyers are showing up for the right producers. The programmed cattle (NHTC, GAP level 4, etc.) that are on a quality vaccination program are typically going to bring the best prices, whether cattle are bringing $1/pound or $3/pound, so I always advise producers to make good genetic and program investments to see the best buyers turnout for them year after year.

JUSTIN MORA

Humboldt Auction Yard

Northern California Coast

REGIONAL WEATHER:

For an area that actually benefits from a drier winter, the winter of 2022-2023 was the worst on record since 1989. That was the last time it took aircraft to deliver hay to stranded cattle – until this year when CalFire and military helicopters delivered hay to cattle that ranchers couldn’t reach because of snow, mud and washed out roads. For about a week the hay (courtesy of Valley Pacific) was dropped by aircraft. Because there are still cattle that ranchers haven’t been able to get to, the total death loss of cattle in the hills isn’t yet known. For some it may be significant. But with grass now popping, things are starting to look up.

MARKETING INSIGHT:

We are in a regionally-challenged area where getting cattle in and out has always presented challenges, which is why our producers in this area go the extra mile to raise high quality calves on good vaccination programs. With calves raised in very cool and comfortable conditions, we need the buyers who take them to know they are going to perform where ever they are going and that the freight is going to be worth it in the end. After waiting for a market this good to hit, it’s unfortunate we had a hard winter and that ranchers here in the hill country lost cattle. We just hope that the postives in the current marketing climate outweigh the battle we had to get here. We’re still hopeful for a good marketing season.

GARY NOLAN

Western Video Market

Eastern & Western Sierra

REGIONAL WEATHER:

Being from Nevada, I am no stranger long winters. But this year really wreaked havoc for guys in Northern Nevada, Southern Idaho and parts of the Northern Sierra. They paid $300/ton for hay and winter just kept coming. Ranches that typically sold cattle in April had to let light calves go in February just to stop the hay trucks from coming. Now that spring is here and the grass is growing, things seemed to have leveled off.

MARKETING INSIGHT:

In Coalinga at the Western Video Market event on May 5, we saw a real barn burner but I am not sure we will see sales at quite that level all summer. Prices should be good but I don’t think packers will pay that much all summer and feedlots can’t afford to. When you drive down through California right now, there aren’t many cattle to be seen. It makes you realize how low the inventory is. With inventory down substantially, we will see pretty good prices for a while yet.

REED MARTINEZ

Modoc Livestock Auction

Northern High Desert California

REGIONAL WEATHER:

Snowpack in the high desert was really good (or bad, depending on how you view it) this year. For the first time in a long time, winter weather showed up on time and lasted well past what we usually see. Cattlemen had to feed longer than usual but at least hay prices should be better when it comes time to restock.

MARKETING OUTLOOK:

Producers always look forward to marketing time but they don’t always know what to expect. For the first time in a long time, I think producers of all kinds are expecting good things. Usually good prices are short-lived but I think this time, we might see it last a little longer. It will be exciting to see how prices hold up. For the few guys who were able to hold onto some replacements last year, selling calves now would be a great reward.