The beautiful thing about rain is that it brings moisture for the land, but it also recharges ranchers' optimism and outlook. The long Memorial Day weekend provided various pockets across the United States with moisture, and upon seeing the drive that the live cattle and feeder cattle contracts had, the market seemed to turn a corner.
While ranchers work nearly around the clock this time of year to get everything done, market statistics can quickly be overlooked, forgotten or misplaced in the hustle and bustle of life. However, we can't afford to overlook this year the beef cows' slaughter pace.
If you were lucky enough to be one of the outfits blessed with moisture this spring, I'm thankful you received it; however, I want to remind you that has not been the case everywhere, and the nation's beef cow slaughter has actually sped up in recent weeks.
Thus far in 2022, the nation has seen 1,573,100 beef cows slaughtered. That's 14% -- 199,200 head -- more than what had been processed at this time in 2021, and 28% (346,880 head) more than the market's five-year average for this time of year.
This means the pendulum is about to swing and favor sellers' positions. With 1,573,100 head of beef cows processed already this year, you can guarantee that the market is going to feel the shock of fewer feeders come this fall.
But the real question is, how are you going to play this hand of cards? Can you afford to buy more cows, more yearlings or maybe some pairs? Maybe you can buy them cheap now and market them later this fall for a quick profit, or maybe buy them now and avoid the sticker shock that's likely to present itself in the months ahead? Or maybe, you have to sit idle and wait your turn to play, as feed is still a questionable wildcard.
Finding the answers to those questions needs to be on your mind. No two operations have the same drought strategy plan, and there are so many different ways to conduct business. However, in these types of markets, one can't ignore the fast-approaching realities and later wish that different decisions were made.
ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com
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