Tag Archive: Price

Bull Buying – Focus on Value Not Just Price

Bull Buying – Focus on Value Not Just Price

Selecting the right bulls are a key component to the success of any cattle operation. When market conditions are less than ideal focus on finding the right bull, not necessarily the cheapest bull.  Photo Credit: Mark Mauldin

2017 is shaping up to be another year of tight margins for cattle producers. As much as ranchers would like to limit expenses during market downturns, some expenditures can’t be postponed. Bulls fall into this category.  The necessity of having an adequate number of bulls goes without saying. When bull buying time and lackluster market conditions coincide there are a few things to keep in mind that can help prevent the situation from having a negative impact on your operation.

When making purchasing decisions, try to consider value over price. Cutting corners rarely results in a positive outcome in the long run. Buying an inferior quality bull now might save you a few dollars in initial cash outlay, but will likely cost you substantially more over the long run than purchasing a quality animal would have.  Bear in mind that the registered cattle market will also be softer this year, although the purebred market typically lags behind the movement of the commercial cattle prices.

The value associated with a bull takes many forms. One of the first forms that can go by the wayside, when buyers are thinking only about price, is the opportunity for risk management and improved calf performance that comes with purchasing a bull with known EPD values. Expected Progeny Differences (EPDs) are figures that predict the performance of a bull’s calves. The science and math behind EPDs can be mind boggling, but the application of the information is fairly straightforward and should be utilized by all cattle producers. The predictive power of EPDs has significant value because it enables bull buyers to stay away from bulls whose calves have a genetic propensity towards negative traits (ie. higher birth weights), and focus on bulls whose calves will be more likely to exhibit positive traits (ie. higher weaning weights).

Purchasing a bull without data is a risk not worth taking. Think about the cost of a calf lost due to calving difficulties, or the earning potential given up by selecting a bull whose calves have substandard growth potential. Remember, a bull will sire numerous calves over his productive lifetime, so even small advantages in performance can have substantial cumulative effects. Why would you give up the opportunity to make an informed selection decision by buying a bull without data?

Assuming you are planning on utilizing performance data in your bull selection process (if not, read the previous paragraphs again), there are some basic steps that can be taken to maximize the value associated with your decision.

Step 1) Identify the type of production system in which the bull will be utilized, and what traits are most economically significant in that type of system. How will the bull’s progeny be marketed or utilized? If all progeny are sold at weaning, the list of significant traits are pretty short: calving ease and weaning weight. If heifers sired by the bull are going to be kept the list gets much longer, as all of the maternal characteristics come into play. If calves are marketed based on carcass merit, then even more factors become economically significant. Beware of single trait selection, but also recognize that you also can’t effectively select for all traits simultaneously. Focus your selection pressure on traits with the largest return on investment.

Step 2) Identify the selection tools available that address these traits. By this point in the process a decision will have to be made regarding which breed of bull you are looking for (this can be a lengthy conversation in and of itself), because the specific resources available will differ from breed to breed. There are specific EPDs that are linked to many economically significant traits. These EPDs are an excellent place to start, but when many traits are being considered simultaneously a simpler technique is to utilize Economic Selection Indices. These indices, which are expressed as $ values, incorporate the economic value of multiple EPDs. Because Economic Selection Indices consider values based on economic significance, it is crucial that bull buyers utilize an index that accurately reflects their operation.

From: Beef Cattle Economic Selection Indices By: Bob Weaber, Kansas State University
http://articles.extension.org/pages/73372/beef-cattle-economic-selection-indices

Step 3) Utilize the tools to select bulls that are the most likely to provide the greatest value to your operation. Effectively using EPDs and Indices, like any other tool, takes some practice and basic understanding. To maximize the effectiveness of the selection tools be sure you are familiar with breed averages, and percentile breakdowns for various traits. (See list below)  This will help you better understand how well the bulls you are considering stack-up within the breed. EPD accuracy (possible change), and the units of measure are also important to keep in mind to help determine what constitutes a meaningful difference between individual bulls.

Links to Breed Averages and Percentile Rankings

Following these steps should help maximize the value of your bull purchase. Price will be a factor in any purchasing decision, and rightfully so, but a bull that does not fit your system and limits your ability to generate return on investment is never a good value, regardless of the price. When financial conditions are tight it is more important than ever to limit risk and make well-informed management decisions based on a plan. When it comes to buying bulls, this means utilizing all available information, and finding a bull that provides real value to your operation.

For more information regarding any of the topics mentioned in this article contact your county’s UF/IFAS Agriculture Extension Agent.  Also, don’t forget about the Florida Bull Test Sale on January 21, 2017, which is an excellent opportunity to find a bull that can bring value to your operation.

 

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Author: Mark Mauldin – mdm83@ufl.edu

I am the Agriculture and Natural Resources agent in Washington County. My program areas include livestock and forage, row crops, and pond management.
http://washington.ifas.ufl.edu

Mark Mauldin

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2017/01/13/bull-buying-focus-on-value-not-just-price/

Cattle Market Price Watch: December 2016

Cattle Market Price Watch: December 2016

The August 2017 Feeder Cattle futures contract decreased by $ 0.22/cwt. during December.  Based on this futures price decrease, August Feeder Cattle revenues decreased by approximately $ 1.65/head ($ 0.22/cwt. * 7.5 cwt.) on a 750-pound feeder steer which amounts to $ 110.00/truckload (50,000 lbs.). The August Feeder Cattle futures contract high, contract low, and price range since September 2016 are $ 128.00, $ 109.90, and $ 18.10/cwt., respectively. The price range of $ 18.10/cwt. on a 750-pound feeder steer totals $ 135.75/head and $ 9,050.00/truckload.

  1. The breakeven price was estimated to be $ 722.10/hd. or $ 131.29/cwt. ($ 722.10/hd. divided by 5.50 cwt.). The breakeven price includes production costs of $ 705/hd. and death loss of $ 17.10/hd.
  2. The price objective was estimated to be $ 872.10/hd. or $ 158.56/cwt. ($ 872.10/hd. divided by 5.50 cwt.). The price objective includes production costs of $ 705/hd., death loss ($ 17.10/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2017 Feeder Cattle futures closing price plus an expected August 2017 South Florida 550 lb. Feeder Calf Basis of $ 2/cwt.

 

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Author: Chris Prevatt – prevacg@ufl.edu

Chris Prevatt

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2017/01/07/cattle-market-price-watch-december-2016/

November Cattle Market Price Watch

November Cattle Market Price Watch

Prevatt FL Cattle Market headerprevatt-chart-1-12-16The August 2017 Feeder Cattle futures contract increased by $ 7.66/cwt. during November. Based on this futures price increase, August Feeder Cattle revenues increased by approximately $ 57.45/head ($ 7.66/cwt. * 7.5 cwt.) on a 750-pound feeder steer which amounts to $ 3,830.00/truckload (50,000 lbs.). The August Feeder Cattle futures contract high, contract low, and price range since September 2016 are $ 128.00, $ 109.90, and $ 18.10/cwt., respectively. The price range of $ 18.10/cwt. on a 750-pound feeder steer totals $ 135.75/head and $ 9,050.00/truckload.prevatt-chart-2-12-16

  1. The breakeven price was estimated to be $ 722.10/hd. or $ 131.29/cwt. ($ 722.10/hd. divided by 5.50 cwt.). The breakeven price includes production costs of $ 705/hd. and death loss of $ 17.10/hd.
  2. The price objective was estimated to be $ 872.10/hd. or $ 158.56/cwt. ($ 872.10/hd. divided by 5.50 cwt.). The price objective includes production costs of $ 705/hd., death loss ($ 17.10/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2017 Feeder Cattle futures closing price, plus an expected August 2017 South Florida 550 lb. Feeder Calf Basis of $ 2/cwt.

 

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Author: Chris Prevatt – prevacg@ufl.edu

Chris Prevatt

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2016/12/17/november-cattle-market-price-watch/

October Florida Cattle Market Price Watch

October Florida Cattle Market Price Watch

Prevatt FL Cattle Market headerprevatt-chart-1-oct-16The August 2017 Feeder Cattle futures contract decreased by $ 4.95/cwt. during October. Based on this futures price decrease, August Feeder Cattle revenues decreased by approximately $ 37.13/hd. ($ 4.95/cwt. * 7.5 cwt.) on a 750-pound feeder steer which amounts to $ 2,475.00 per truckload (50,000 lbs.). The August Feeder Cattle futures contract high, contract low, and price range since September 2016 are $ 128.00, $ 109.90, and $ 18.10/cwt., respectively. The price range of $ 18.10/cwt. on a 750-pound feeder steer totals $ 135.75/hd. and $ 9,050.00 per truckload.

prevatt-chart-2-oct-16

  1. The breakeven price was estimated to be $ 722.10/hd. or $ 131.29/cwt. ($ 722.10/hd. divided by 5.50 cwt.). The breakeven price includes production costs of $ 705/hd. and death loss of $ 17.10/hd.
  2. The price objective was estimated to be $ 872.10/hd. or $ 158.56/cwt. ($ 872.10/hd. divided by 5.50 cwt.). The price objective includes production costs of $ 705/hd., death loss ($ 17.10/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2017 Feeder Cattle futures closing price plus an expected August 2017 South Florida 550 lb. Feeder Calf Basis of $ 2/cwt.

 

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Author: Chris Prevatt – prevacg@ufl.edu

Chris Prevatt

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2016/11/12/october-florida-cattle-market-price-watch-2/

September Florida Cattle Market Price Watch

September Florida Cattle Market Price Watch

Prevatt FL Cattle Market headerChris Prevatt, UF/IFAS Regional Livestock Economics Agent

prevatt-sept-16-chart-1revThe August 2017 Feeder Cattle futures contract decreased by $ 10.38/cwt. during September. Based on this futures price decrease, August Feeder Cattle revenues decreased by approximately $ 77.85/hd. ($ 10.38/cwt. *
7.5 cwt.) on a 750-pound feeder steer which amounts to $ 780 per truckload (50,000 lbs.). The August Feeder Cattle futures contract high, contract low, and price range since September 2016 are $ 128.00, $ 117.10, and
$ 10.90/cwt., respectively. The price range of $ 10.90/cwt. on a 750-pound feeder steer totals $ 81.75/hd. and $ 5,450.00 per truckload.

prevatt-sept-16-chart-2

  1. The breakeven price was estimated to be $ 722.10/hd. or $ 131.29/cwt. ($ 722.10/hd. divided by 5.50 cwt.). The breakeven price includes production costs of $ 705/hd. and death loss of $ 17.10/hd.
  2. The price objective was estimated to be $ 872.10/hd. or $ 158.56/cwt. ($ 918.00/hd. divided by 5.50 cwt.). The price objective includes production costs of $ 705/hd., death loss ($ 17.10/hd.), family living withdrawal
    ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2017 Feeder Cattle futures closing price plus an expected August 2016 South Florida 550 lb. Feeder Calf Basis of $ 2/cwt.
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Author: admin – webmaster@ifas.ufl.edu

admin

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2016/10/07/september-florida-cattle-market-price-watch/

May Florida Cattle Price Watch

May Florida Cattle Price Watch

Prevatt FL Cattle Market headerChris Prevatt, UF/IFAS Livestock Economist

Prevatt Chart 1 6-3-16The August 2016 Feeder Cattle futures contract made a $ 5.60/cwt. price improvement during May. Based on this futures price increase, August Feeder Cattle revenues increased by approximately $ 42.00/hd. ($ 5.60/cwt. * 7.5 cwt.) on a 750-pound feeder steer which amounts to $ 2,800.00 per truckload (50,000 lbs.). The August Feeder Cattle futures contract low, contract high, and price range since September 2015 are $ 139.80, $ 188.70, and $ 48.90/cwt., respectively. The price range of $ 48.90/cwt. on a 750-pound feeder steer totals $ 366.75/hd. and $ 24,450.00 per truckload.

Prevatt Chart 2 6-3-16

  1. The breakeven price was estimated to be $ 783.30/hd. or $ 142.42/cwt. ($ 783.30/hd. divided by 5.50 cwt.). The breakeven price includes production costs of $ 765/hd. and death loss of $ 18.30/hd.
  2. The price objective was estimated to be $ 933.30/hd. or $ 169.69/cwt. ($ 933.30/hd. divided by 5.50 cwt.). The price objective includes production costs of $ 765/hd., death loss ($ 18.30/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2016 Feeder Cattle futures settlement price, plus the expected August 2016 South Florida 550 lb. Feeder Calf Basis of $ 8/cwt.
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Author: admin – webmaster@ifas.ufl.edu

admin

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2016/06/04/may-florida-cattle-price-watch/

December Florida Cattle Market Price Watch

Prevatt FL Cattle Market headerChris Prevatt, UF/IFAS Livestock Economist

Prevatt Dec 1The August 2016 Feeder Cattle futures contract declined by $ 1.10/cwt. during December. Based on this futures price decrease, August Feeder Cattle revenues decreased by approximately $ 8.25/hd. ($ 1.10/cwt. * 7.5 cwt.) on a 750-pound feeder steer which amounts to $ 550.00 per truckload (50,000 lbs.).

The August Feeder Cattle futures contract low, contract high, and price range since September 2015 are $ 147.20, $ 188.70, and $ 41.50/cwt., respectively. The price range of $ 41.50/cwt. on a 750-pound feeder steer totals $ 311.25/hd. and $ 20,750.00 per truckload.Prevatt Dec 2

  1. The breakeven price was estimated to be $ 768.00/hd. or $ 146.29/cwt. ($ 768.00/hd. divided by 5.25 cwt.). The breakeven price includes production costs of $ 750/hd. and death loss of $ 18.00/hd.
  2. The price objective was estimated to be $ 918.00/hd. or $ 174.86/cwt. ($ 918.00/hd. divided by 5.25 cwt.). The price objective includes production costs of $ 750/hd., death loss ($ 18.00/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2016 Feeder Cattle futures closing price plus an expected August 2016 South Florida 525 lb. Feeder Calf Basis of -$ 2/cwt.

 

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Author: admin – webmaster@ifas.ufl.edu

admin

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2016/01/09/december-florida-cattle-market-price-watch/

November Florida Cattle Market Price Watch

November Florida Cattle Market Price Watch

Prevatt FL Cattle Market headerChris Prevatt, UF/IFAS Livestock Economist

Prevatt Nov Chart 1The August 2016 Feeder Cattle futures contract declined by $ 16.38/cwt. during November. Based on this futures price decrease, August Feeder Cattle revenues decreased by approximately $ 122.85/hd. ($ 16.38/cwt. *7.5 cwt.) on a 750-pound feeder steer which amounts to $ 8,190 per truckload (50,000 lbs.). The August Feeder Cattle futures contract low, contract high, and price range since September 2015 are $ 159.98, $ 188.70, and $ 28.72/cwt., respectively. The price range of $ 28.72/cwt. on a 750-pound feeder steer totals $ 215.44/hd. and $ 14,362.50 per truckload.Prevatt Nov Chart 2

  1. The breakeven price was estimated to be $ 768.00/hd. or $ 146.29/cwt. ($ 768.00/hd. divided by 5.25 cwt.). The breakeven price includes production costs of $ 750/hd. and death loss of $ 18.00/hd.
  2. The price objective was estimated to be $ 918.00/hd. or $ 174.86/cwt. ($ 918.00/hd. divided by 5.25 cwt.). The price objective includes production costs of $ 750/hd., death loss ($ 18.00/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2016 Feeder Cattle futures closing price plus an expected August 2016 South Florida 525 lb. Feeder Calf Basis of -$ 2/cwt.

 

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Author: admin – webmaster@ifas.ufl.edu

admin

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2015/12/12/november-florida-cattle-market-price-watch/

October Florida Cattle Market Price Watch

October Florida Cattle Market Price Watch

Prevatt FL Cattle Market headerChris Prevatt, UF/IFAS Livestock Economist

Prevatt Figure 1The August 2016 Feeder Cattle futures contract made a $ 13.20/cwt. price improvement during October. Based on this futures price increase, August Feeder Cattle revenues increased by approximately $ 99.00/hd.  ($ 13.20/cwt. * 7.5 cwt.) on a 750-pound feeder steer which amounts to $ 6,600 per truckload (50,000 lbs.). The August Feeder Cattle futures contract low, contract high, and price range since September 2015 are $ 166.30, $ 188.70, and $ 22.40/cwt., respectively. The price range of $ 22.40/cwt. on a 750-pound feeder steer totals $ 168.00/hd. and $ 11,200 per truckload.Prevatt Figure 2

  1. The break-even price was estimated to be $ 768.00/hd. or $ 146.29/cwt. ($ 768.00/hd. divided by 5.25 cwt.). The break-even price includes production costs of $ 750/hd. and death loss of $ 18.00/hd.
  2. The price objective was estimated to be $ 918.00/hd. or $ 174.86/cwt. ($ 918.00/hd. divided by 5.25 cwt.). The price objective includes production costs of $ 750/hd., death loss ($ 18.00/hd.), family living withdrawal ($ 100/hd.), and growth capital/retirement ($ 50/hd.).
  3. The expected cash price is equal to the daily August 2016 Feeder Cattle futures closing price plus an expected August 2016 South Florida 525 lb. Feeder Calf Basis of +$ 8/cwt.

 

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Author: admin – webmaster@ifas.ufl.edu

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Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2015/11/07/october-florida-cattle-market-price-watch/

Pollen and Allergy Season: The Price We Pay for Living in a Lush Landscape

Pollen and Allergy Season: The Price We Pay for Living in a Lush Landscape

It’s that time of year again, that time when your car changes color like a chameleon in order to mimic the surrounding landscape. Anything that stands still long enough will become coated with a light green to yellow dust. What is this dust you might ask? What you are seeing is pollen, a sure sign that spring has arrived and allergy season is here! The pollen that can be seen is from pine trees and is not a major contributor to allergies, but the invisible pollen from oak trees and other plants can wreak havoc on sinuses. And while you may be cursing the trees for causing your eyes to water and coating your car, it’s important to remember that plants need pollen in order to reproduce.

Pollen disseminating from a pine tree. Picture courtesy of http://supermanherbs.com/megadose-pine-pollen/

Pollen disseminating from a pine tree anther. Picture courtesy of http://supermanherbs.com/megadose-pine-pollen/

Pollen is disseminated from blooming trees and plants. The process of pollination develops new plant seeds. Pollen is dry and light, enabling it to float through the wind and travel several miles. Plants that depend on wind for dispersal have to produce massive amounts of pollen since only a small amount will actually result in seed production. Plants pollinated by insects don’t have to produce as much pollen because of the efficiency of the insects in distributing the pollen. Changes in the weather directly influence the amount of pollen and how it will affect allergy sufferers. Rain dampens pollen and reduces its ability to flow through the air. A freeze can also slow down a tree’s rate of producing pollen. Windy and warm weather can increase pollen amounts.

A Leon County allergy and asthma specialist stated that roughly 40 percent of the population suffers from pollen allergies. The best thing you can do if you are part of this 40 percent is to reduce your exposure to pollen. Here are a few ways you can keep your allergies at bay:

  • Dry clothes in an automatic dryer rather than hanging them outside to avoid pollen collecting on clothing and being carried indoors.
  • Consider limiting outdoor activities during the pollen season (Florida trees often release pollen from January to June).
  • Stay inside during peak pollen times (from 10 a.m. to 4 p.m.).
  • Restrict outdoor activities during days with high winds and low humidity.
  • Shower after spending time outdoors to remove pollen from hair and skin.
  • Use air filters and clean regularly, or run an air conditioner and change the air filter frequently.
  • Wear a dust mask when mowing the lawn, gardening, or raking leaves.

If you would like to know what trees are producing pollen in your area at certain times of the year you can visit this website http://www.pollenlibrary.com/State/Florida/. As always, feel free to contact your local Extension Office for more information.

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Author: Taylor Vandiver – tavandiver@ufl.edu

Taylor Vandiver

Permanent link to this article: http://franklin.ifas.ufl.edu/newsletters/2015/03/24/pollen-and-allergy-season-the-price-we-pay-for-living-in-a-lush-landscape/