Cattle Prices Declining Momentarily
The cattle market in the United States is one of the biggest markets in the world. We have seen near record highs throughout much of the last year in the live cattle market but lately it has started to decline sharply. Most of the reason behind this slide is because corn and corn futures have recently begun to level out to manageable prices. Live cattle prices have fallen but packaged beef is still very high in spite of the lower cash cattle prices. The expectations and spikes that are normally in place before the Government crop reports come out are not happening this week.
There is a lot of mild concern with the 2013 corn crop which is only around 6% planted in the United States at this time. Last year during this week we were around 30% planted and contending with one of the worst droughts in history. These drought conditions pushed corn and soybean prices through the roof for much of the summer and winter. As the grain prices soared-so did the price of live cattle. We saw prices that were huge and many cattle farmers benefited even with the high grain prices. The producers who were best prepared for this market were the ranchers who also produced their own corn.
At this time with the very wet weather in the Mid West and the very cold ground temperatures in the Wheatbelt, field work has been reduced to a crawl. Where we are as a nation with planting around May 20th will have a lot to do with this years outlook. Most indicators seem to point to some dryer weather and everyone will be hustling in the field to get corn in the ground. As a nation, we are still looking at planting 97 million acres of corn this year. What does this mean? At current and forecasted grain projections- feed prices could fall sharply giving beef producers a good chance to capitalize on the market when it comes back-and it will.
It is still a very good idea to buy farmland and for beef producers to produce their own grains for feeding if possible. It doesn’t look like we will have the prices on cattle or corn that we had last year but if the crops do not get planted in time, or if another bad drought hits us-then we could be looking at a repeat of last year. We have seen a big increase in our State in people buying farmland and pasture. With interest rates still better than ever it is a great time to buy Alabama farmland for sale. The Southern Land Brokers have a nice inventory of Alabama farms for sale and will continue to help our clients find the pasture or farmland that they need.
