CanFax: Short Cow Numbers Lead to Thin Packer & Feeder Margins in 2012

Cattle producers and industry members from the U.S., Canada and beyond gathered at NCBA 2012 to talk about the state of the industry, the triumphs and the challenges. As we look further ahead into 2012, the challenges for the margin operator don’t seem to get any easier. In fact, you could say that it looks like there’s going to be a lot more more risk for a lot less reward. One of the reasons for that rather grim forecast is the expectation of the growth of the North American cattle herd. There are projections that cattle for slaughter could decrease by roughly 2 million head, driving up the price and availability of cattle for the feeder and the packer.  The rancher has a much higher probability of achieving profitability than the feeder or packer in 2012 based on the analysis of many insiders.

SEE MORE NCBA 2012 COVERAGE.

I spoke to Brian Perillat of CanFax about some of the potential challenges ahead for the margin operator, the current state of Canada/U.S. relations and some of the factors influencing the growth of the North American cattle herd.  With heifers being held back the amount of calves available to feeders will get even tighter.  Purchasing feeder cattle and managing risk is the definite play of the day.

If you cannot see the embedded video below click here.

 

Shaun Haney

Shaun grew up on a family seed farm in Southern Alberta. Haney Farms produces, conditions and retails wheat, barley, canola and corn seed. Shaun Haney is the founder of RealAgriculture.com. @shaunhaney

Trending

TechTour: Extra sets of eyes on machinery improve efficiency

For farmers with plenty of help, it's the eyes and ears of others around the farm that help with spotting, moving, or monitoring equipment. For farmers like Jim Hale, from Lancer, Sask., cameras installed on some of his machinery have replaced some of that help. A cereal, pulse, and oilseed farmer, Hale runs his farm operation on his…Read more »

Related

Leave a Reply