Cows and heifers gold as producers look for replacements

News
Oct 14, 2011
by DTN

Bred females and heifers are going to be gold on the hoof this fall, especially across parts of the south.

Even with uncertain feed supplies and weather conditions, herd rebuilding is expected to keep bred female and heifer sales strong going into 2012.

Early reports from sales across parts of the south are putting prices $100 to $150 higher on replacement heifers compared to a year ago.

Joy Reznicek, head of Cow Creek Ranch in Aliceville, AL, says they are expecting good things this year and next. The ranch raises Brangus cattle and plans to hold their 17th annual commercial bred heifer sale in October. Reznicek says there is an increase in demand for Brangus genetics now, and this along with expansion in the industry will help keep her ranch on solid ground.

“Cow inventory is very low, and we’re all aware of how many cattle have had to be slaughtered in Texas because of the drought. There’s a lot of concern in the cattle industry as to where the replacements will come from. We think here in the south, where we have the forages to keep a cow on grass nine months out of the year, we are in a unique position to provide for that need,” says Reznicek. She adds, she sees a bright future for the cow/calf producer for at least the next five to seven years.

“We are just now getting into the season when people start looking for females,” she says. “There’s always more optimism going into the fall. We know the demand is out there, and we know people are willing to pay more for replacements this year. We don’t know how much more, but we’re really optimistic.”

Georgia Cattlemen’s Association’s Josh White agrees prices could be strong this buying season all across the south. He says over the last month, he’s heard $1,400 a head for bred heifers, sold by the trailer-load.

In addition, he says the association cosponsors bred heifer sales with the University of Georgia Extension Service, and those sales, held back in the spring, were strong as well, in some cases setting records.

According to CattleFax analyst Lance Zimmerman, the south is one part of the country where higher prices are likely to be seen for bred females, especially if weather conditions are favorable.

He expects bred females to sell in the range of $1,500 to $1,700 for high quality genetics. In some cases, specifically those areas where drought has not been an issue, he says prices could go even higher, to $2,000 per head for a bred female.

But not everyone is convinced it’s time to rebuild yet, and that’s one factor that could impact prices.

“We are hearing that many southern producers are struggling with the thought of rebuilding their lost herds,” says Zimmerman. “A number of these producers are in their late 50s and older, and they have been building their herds for decades. The drought has taken that away from them, and there is a real emotional toll there. In their minds, they finally had the

ideal herd, and now at the point where we have record high calf prices, that herd is gone.”

Zimmerman says in order to get excited about rebuilding, and fuel prices for replacements, producers will need to see more precipitation in their drought-strick en areas. In addition, he adds there are concerns that some producers may have trouble getting the credit they need to borrow enough to buy replacements.

In Georgia, White says they too have been concerned about credit for producers, but he says so far,

things appear to be working out. “Well-capitalized producers are not having problems with credit,” he reports. “We have a good farm credit system in Georgia, and we’re also finding our community banks are reaching out to farmers now.”— Victoria Meyers, DTN

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