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BULL BUYERS GUIDE 2013
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USDA declares Wheat Belt disaster
Client: UFA File Name: Calving_Earlug_3.08x1.83_v1 Project Name: Calving Earlugs Docket Number: 110200909 Flat size: 3.08” x 1.83” Publication: ABFX
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Canfax analyst says outlook for calf prices is strong DEMAND REMAINS While drought and high feed prices are pushing down
WINTER WHEAT Worst
U.S. cow herd numbers, the country’s beef exports are soaring and domestic prices are expected to stay strong
conditions on record; up to a quarter could be abandoned
BY DANIEL WINTERS STAFF
STAFF
I
f you’re mulling whether to buy calves to put on grass this spring, keep in mind that there’s a great big red blob of uncertainty looming over the market. To see it, go to the U.S. Drought Monitor website at droughtmonitor.unl.edu. The map on the home page shows much of the Midwestern Corn Belt and major cattle-producing states is coloured red or rust red — the colours assigned to the two worst drought categories. It is also the region that sucked up huge quantities of
T
he United States government declared much of the central and southern U.S. Wheat Belt a natural disaster area on Jan. 9 due to persistent drought that imperils this year’s winter wheat harvest. In its first disaster declaration of the new year, the U.S. Agriculture Department (USDA) made growers in large portions of four major wheat-growing states — Kansas, Colorado, Oklahoma and Texas — eligible for low-interest emergency loans. The four states grew one-third of the U.S. wheat crop last year. Kansas was the No. 1 state at 382 million bushels. In all, USDA listed 597 counties in 14 states as natural disaster areas. They suffered from at least severe to in some instances extraordinary drought for eight weeks in a row to qualify for the designation. More than half of them, 351 counties, were in the Wheat Belt,
hay from the Prairies and sent feed grain prices to the moon last year. No one knows how much longer the drought will last but experts say North American cattle prices going into the fall are likely to remain strong no matter what happens. If it rains, calves in backgrounding lots now will go to grass and hit the market at the usual time next fall. No rain, and they’ll show up earlier. “But if a whole pile of calves go into the feedlot right now in the U.S., it may be good to buy grassers to fill that void in August or later in the year,” Canfax market analyst Brian Perillat said at a recent meeting in Ste. Rose du Lac, Man.
Cow-calf producers needn’t be concerned too much about it, however. “Supplies are tight no matter what happens. There’s going to be way less calves in 2013,” he added. With the U.S. cow herd continuing its 14-year trend lower by a further three per cent, and the country’s exports continuing to soar due to the devalued greenback, the massive hole in North American beef supplies will take several years to fill, he predicted. That’s because heifer replacements for the 30-million-head herd south of the bor-
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SEE WHEAT BELT page 6 PHOTO: JEANNETTE GREAVES
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