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Across the West, the livestock
auction marketing system is a staple of many rural, ranch
communities. And, support runs deep for these local auctions.
With technology, many of today’s
auction markets have advanced to team with video auctions and
reach a greater number of potential buyers. But the premise is
still the same – a means of seeking true price discovery through
the live auction.
Here’s a quick glimpse at what
auction yard managers believe are the best things producers can
do to help get the best price for their calves and what they
foresee the market may do in 2008.
Communication Key
Communication is the key to a successful sale, believes Max
Olvera with Turlock Livestock Auction Yard at Turlock, CA. “We
focus on communicating with producers so they can consign to
catch one of our special calf sales and be exposed to as many
buyers as possible.”
He adds, “Whether someone has 10
head or 1,000 head to sell, we are willing to work with them. We
have a lot of small producers, but when you get several of them
to consign, collectively you have a big sale offering.”
Communication to buyers is also
critical. “We believe in promoting our consignments to buyers to
draw more interest to the sale,” says Olvera. “I’m a big
believer in advertising the sale and the consignments. You’ve
got to be known by buyers across the region – and really across
the country.”
He adds, “As we move into spring
and summer, we see a lot of movement of calves and yearlings
here in California, so that communication between buyers and
sellers is essential.” He says it is especially beneficial for
producers to promote the extra investments they’ve made at the
ranch – such as vaccination programs, quality assurance steps,
and quality genetics. “All those things help add dollars,” says
Olvera.
Monte Bruck with Fallon Livestock
Exchange at Fallon, NV, agrees, saying the more information a
seller can provide the buyer, the more potential there is to
sell calves at a higher price. “Producers need to express to
auction barns their herd health programs, weaning dates, and
genetic backgrounds of the calves, so that information can be
promoted,” he says.
Likewise, Trent Stewart co-owner
of Central Oregon Livestock Auction south of Madras, OR, says in
order to top the market with your calves, “Vaccination programs
are paramount.”
Stewart, who has been with Central Oregon Livestock for 15
years, also adds that buyers seem to want a vaccination program
that includes two series of modified live vaccinations done at
least three weeks prior to the calves coming to the sale ring.
“The vaccination needs to be done at the right time in order for
it to be effective,” he says.
Asked about animal ID, Stewart
says it can be a good thing and add value, but, at this point he
hasn’t seen a lot of producers offering it or buyers demanding
it.
’08 like ’07
All three of these auction market managers feel the year ahead
will be much like 2007.
Looking ahead, Bruck jokes that his crystal ball broke a long
time ago, but he predicts the market will be “steady in 2008.”
Of the market outlook, Stewart
says, “I think it’s going to be a carbon copy of 2007. I don’t
see any drastic changes. Hopefully diesel and corn don’t get any
higher.”
Specifically, he anticipates that
yearling cattle in March may struggle, but he expects a market
rally in April, May and June. He says, “With $10 wheat no one is
going to graze that out, so we should see the markets rally this
spring.”
Stewart also expects the video
season will be strong this summer.
Olvera says based on the current
positive cattle futures for spring and summer, he believes the
cattle market is looking at a good 2008. “It won’t be the high
prices like a couple years back, but it should still be pretty
good.”
In California, Olvera says
January rains will really help. “Those were saving rains we
received. Everyone is a lot more positive with the rain.”
He anticipates a good market for
pairs and bred females. “There are a lot of folks out there who
want to buy cows and add back to their herds after having to
downsize during the drought the past few years. “If 2008 has
normal rain and feed available, it should be a good year for the
market,” he concludes.
Sex, Lot Size, Color Still Lead Auction Value
As part of a three-state auction market study, Extension beef
specialists from the Dakotas and Montana evaluated premiums paid
for calves in those states across auction sales for three
consecutive weeks.
All told, data was collected on
68,475 calves (6,251 lots). The average weight was 520 lbs.
Calves selling in the smallest lot size (five head or fewer)
were worth the least on a hundredweight (cwt.) basis. Calves
sold in lot sizes of 21 head or more commanded $6.20/cwt. more
than those small lots. Lot sizes of 6-10 head and 11-20 head
came in at $4.22/cwt. and $4.31/cwt. more than the small lots,
respectively.
Steers brought the most —
$9.78/cwt. more than heifers. Likewise, black and black
whiteface calves brought the most money of any color —
$3.48/cwt. more than white calves, $2.98/cwt. more than red and
red whiteface; $2.25/cwt. more than mixed-color sets.
The study also underscored the health premium available to
calves. In this study, calves with a vaccination history sold
for as much as $2.50/cwt. more (four-way viral) than
unvaccinated ones. That mirrors the $14.58 (basis six-weight
steer) per head premium these same researchers found with
Montana Beef Network calves — VAC-34 and VAC-45 — selling
through specific Superior Video Sales.
The data also showed that natural
calves brought $1.55/cwt. more than conventional calves.
Source: North Dakota State University. |
