The Market Report

September 17, 2019

 

I’ve spent the week trying to figure out why the Packer owns a fat steer for 48 hours and makes $600 and we own him thirty months and lose money. Several people asked me what we could do about that tremendous inequity. It has been brought to my attention that several people across the country have been also looking into the problem that this tremendous inequity poses to this industry. We spend a lot of money on Beef Promotion, Brand Inspection, and producing a quality product to have it stolen in the last few days we own it. So here we go.

There are some key things that happen in this process that we should look at, if we really want to solve the problem. First, in order to get higher prices for beef the packer must control the inventory. The better job of that he can do, the higher the price he can get. So, what is the process that allows the packer to help control his inventory? To begin with he owns cattle. Second, he contracts fat cattle out front. Third he offers a premium to quality cattle so feeders will commit their cattle to him. If this is the situation, then we need to control the total inventory that will be made available to him. Pretty simple when you think about it however, the real issue here is how can we change the way fat cattle are priced? As I see it, if the packer has inventory there is no reason for him to want any change in the way we sell fat cattle. So here comes the solution

We start to control the inventory in our total supply chain. It would start at the ranch go to the stocker operator, and then to the feeder. A system of holding inventory at every level would allow us to move the fat cattle up in less than 200 days. I’ll repeat that, if we develop a system of controlling our inventory, we can move the price of fat cattle up in less than 200 days. Once we are getting a fair price for our fat cattle then we can address how we are going to change the way we sell fat cattle. As a matter of fact, we can take the next 200 days to develop that plan. This business has some of the most astute people in the country involved in cattle. A committee of those people assigned to that task would put us light years ahead of what we are doing now. It would also have a system in place when we obtained control of our inventories so we could act.

I spent 1 1/2 hours talking the importance of Livestock Markets with a woman that is doing some work on grazing value to our lands and she realized just how important Livestock Markets are to the whole beef complex. Eighty five percent of all cows and bulls go through Livestock Markets. There was a lot more we discussed, but I’ll wait for her final report and her okay before I say more.

The Market was steady last week. Fat cattle want to move higher and the grains have been mixed. It’s difficult to sell the plain cattle. No one wants them. We’re luckier than most because we have a few buyers for them, but they must be cheap. That is typical in a rough market.

Jim Warren 83l 320-3698

Here are some representative sales from this week’s auction:


Representative Sales

 

3 Blk 487# steers sold for $142.00

9 Blk, B BR 579# steers sold for $144.00

10 Blk 642# steers sold for $136.00

11 Blk 657# steers sold for $131.00

16 Blk, B BR 684# steers sold for $128.50

14 Blk, Red 762# steers sold for $120.00

 

50 Blk, Red 463# heifers sold for $131.00

11 Blk, BWF, Char 502# heifers sold for $131.00

10 Blk 565# heifers sold for $128.00

7 Blk, BWF 590# heifers sold for $120.50

23 Blk, BWF, RED 669# heifers sold for $122.25

 

 

 

 

 

 Special Dates

 

Thursday September 19th

Customer Appreciation Dinner

And Informative Speakers

6pm

101 Livestock

4400 US 101

Aromas, California

 

Saturday November 2nd

Topline Leachman Bull Sale

At the 101 Livestock Market

 

 

 

 

 

 

Cows Average/cwt High/cwt
Cutters $51 $57
Boning Utility $58 $62
Breakers $65 $74

 

Bulls Average/cwt High/cwt
High Yield $80 $87
Others $71 $80

 

 

 

Multimen USA, Inc and 101 Livestock Market together with Topline Leachman Bulls

Invite you to Join us for dinner and informative speakers on Thursday, September 19th at 6:00pm at the 101 Livestock Market

Please RSVP to Carolyn Warren at 831-229-1742