Sale Barn Study

Sale Barn Study

A review of the current cattle market.

contributed article by Kirk Lynch - Lynch Livestock Inc. and Humeston Livestock Exchange, Humeston, Iowa

humestonlivestockexchange.com

CURVEBALL

Life is full of curveballs and this past week we were thrown a big one in the cattle markets. Probably the biggest one since the “Mad Cow” scares. Those markets had good reason for the bottom falling out; this situation, I believe, is completely different. The fire at the Tyson plant in Kansas scared people into thinking we would have a major backlog and pile up of cattle. It was unheard of that box beef prices would go up the amount they did with the board and cash markets just bottoming out. The packers were handed a reason to pad their pockets even more, and they jumped on it. All reports are showing that more total cattle were harvested the week after the fire compared to the week before the fire.

With all that being said, I believe there was good reason for panic right after the fire, but as the dust settles, I believe the market will rebound rather quickly. As we saw last week, packers were able to find the space in other plants to make up for the 5% loss at Tyson. Not to mention, as they made record profits, they will find a way to harvest as many cattle as possible. It is not as if the demand for beef has gone away.

We haven’t seen much of a change in the cull cow/bull market, and the Holsteins have backed off some. The feeder prices have been a little hit and miss. I have seen some sell where this fat cattle dip in the market didn’t affect what they brought (this may be attributed to the price of corn also). I have not seen much price change in the value-added and program cattle. I have also seen some sell that were well worth the money. I anticipate this to be true everywhere over the next couple weeks as we get this fat cattle market straightened out. With that being said, there may be some opportunity with these feeder cattle, as I believe we will have some of the most reasonably priced feeders sell this fall in the next couple weeks as we sit and wait for this fat market to correct (as it should). There are also some fall bred and summer/fall pairs that have been well worth the money, especially with what appears to be plenty of hay throughout most of the Midwest.

We are kicking off our Fall sale season in Humeston on the 28th and we will start seeing more and more cattle coming through the barn each week so we should have a good feel on the cattle markets next month, especially after all this settles down. That’s all for this month!

Kirk Lynch, Lynch Livestock Inc., Waucoma, IA

Kirk is the Beef Division manager for Lynch Livestock Inc. and oversees all aspects of their backgrounding and cattle feeding operations throughout Iowa and Kansas. He is also deeply involved in the newly re-opened Humeston Livestock Exchange in Humeston, Iowa. In addition, Kirk and his wife Mary own and operate Heartland Simmentals in Northeast Iowa, which is a seed stock operation that consists of 500 registered Simmental and Angus cows. They have three children: Gabrielle, 6, Brayden, 4, and Vivian, 2.

September 2019

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