MBC130117

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THE END IN SIGHT?

A PASSION FOR PORK Reaching new customers through YouTube » PG 6

Optimism over TB eradication » PG 3

JANUARY 17, 2013

SERVING MANITOBA FARMERS SINCE 1925 | VOL. 71, NO. 3

Is buying more land really worth it?

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MANITOBACOOPERATOR.CA

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Canfax analyst says outlook for calf prices is strong

Some tough number crunching is needed By Lorraine Stevenson

While drought and high feed prices are pushing down U.S. cow herd numbers, the country’s beef exports are soaring and domestic prices are expected to stay strong

CO-OPERATOR STAFF / ST. JEAN

M

anitoba farmland has been a great investment, but that’s no reason to buy more of it. “My question is, ‘Can we afford to farm land at these rent prices or afford to buy land at these prices?’ — and that’s not an easy question to answer,” business development specialist Dan Caron told a packed audience at the recent St. Jean Farm Days. Farmland values in the province have risen steadily over the past 25 years, declining only durSee LAND on page 6 »

PHOTO: BARB ALSTON

By Daniel Winters CO-OPERATOR STAFF / STE. ROSE DU LAC

I Publication Mail Agreement 40069240

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 USDA’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 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

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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 the recent Beef and Forage Days. 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 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 border are up only one per cent, and even a hefty expansion of Canada’s four million head won’t be enough to fill the gap. Many ranchers south of the border are desperately trying to hang on despite high feed costs. If they are forced to fold due to a second year of drought, the resulting shortage of cattle will push prices skyward in the coming years. “If they don’t get the rain, there could be another flush of cattle hit the market. Then next year, the beef shortage will really show up,” Perillat said. But producers will continue to face See CANFAX ANALYST on page 6 »

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