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Higher Prices Hearten Ranchers Young And Old

After years of living through the “downs” of the cattle business, Dewi and Liz Davis are hoping recent signs of an upward trend are for real.

“We’re feeling a bit more optimistic this year than we were last year,” said Davis, who immigrated from the U. K. with his family and bought their first Canadian herd just 10 days before the border closed because of BSE in the spring of 2003.

“It’s close to break-even,” he said, as he watched cattle move through the ring at Heartland Livestock Services’ regular sale, which saw 1,100 animals sold Oct. 12. “For a 700-pound calf, straight off the cow, we need $800 to cover our costs and give us a little to live on.”

Last week, he tested the market with 10 calves, and was pleased to see them bring 25 cents per pound more than last year. On that day, he sold a 1,600-pound cull cow for 53 cents/lb., and was waiting to see how much a further portion of his fall calf crop would bring.

They made it through the BSE crisis, got a boost from a break-even year in 2005, and now they plan to increase their bred cow herd numbers from the current 150 to 200 head and expand production mainly through improvements on their existing land base.

“We’ll try and make money out of it,” he said. “If we don’t, we’ll try and make a living out of it.”

Also in the bleachers that day was a truly rare bird: a young rancher just starting out. Even more startling was his cautiously optimistic mood.

“I would say that things are looking better,” said Ben Caines, 22, a Carberry-area rancher who has built up his herd from just four cows in 2002 to now 30, all while working full time on a nearby potato farm.

“Compared to last year, I think I’m getting a bit better of a profit,” said Caines.

Is he getting a wage?

“Maybe just a little one,” he said with a smile.

With 15 calves due to go through the ring, he, too was heartened by what he saw at the auction the week before. Last year, he got 70 to 80 cents per head for heifers, and this year he was hoping for at least $1.10.

He opted to hit the market early, having gotten burned other years by waiting for prices to rise further and then only to see them plummet.

“I haven’t seen a heifer of mine get $1/lb. for four or five years,” said Caines. “If the price is there, I’m getting rid of them.”

Jack Robertson, a retired “dabbler” with 13 cow-calf pairs that he kept at the community pasture all summer before cashing them in at the sale last week, was waiting to see how his bet would pay off.

He bought each pair in spring for $1,000 each, and his profit would come out of the price he got minus his costs plus the $1,495 pasture fee, covering the period from June 7-Oct. 8.

“I’m just an old man getting the farming out of his system after 30 years,” he said, with a chuckle. “If I lose enough money, I won’t do it again.”

John Watterson, also from Carberry, was more conservative in his outlook, figuring that it was still too early to declare that the hard times have come to an end.

“It’s anybody’s guess,” he said. “I wouldn’t like to see any more of the way it’s been.”

Feeders were up, he added, but fats were down. He suspected that the big packers have been cornering the market by filling their own feedlots in a bid to push down prices.

At that moment, a single cull cow with very bad front feet limped through the ring, and left after fetching almost 49.75 cents/ lb.

With access to low-cost potato waste, Watterson, who has 14 cows left, bought 100 feeders earlier this fall. He was planning to feed them until spring, and hoped that fats would pick up by then.

Donna Pingerts, a cattle feeder from Carberry, was sitting with the buyers at ringside.

“The feeders are high for the price you get for the fats,” she said, adding that they planned to cut back on buying this year in the face of steeper competition for feeders.

Rick Wright, a buyer for Nilsson-owned Heartland Order Buying Company, pegged the fall calf run as being about three weeks behind schedule because of the stretched-out supply of late-fall grass and the delayed harvest schedule.

“Prices have been good and harvest is late, so guys are trying to do their fall work, and it doesn’t look like there is going to be a major collapse in the cattle in the near future,” said Wright. “So, they’ll do their priority jobs first and move the cattle second.”

Also, late-spring calving is catching on, and that means less calves moving early in fall.

He believed that current estimates of the number of cattle left around the countryside may be a lot higher than they actually are.

“We’re not going to see the huge numbers that we saw other years, so there isn’t as much of a panic to get ahead of the rush.”

The reduced flow of calves going to market this year may be pushing up prices, he said, but the bigger factor is the global shortage of cattle. That, and greater optimism in the sector, may be causing more aggressive bidding among buyers.

“We can’t be quite as fussy today as we have been other years because of the shortage,” said Wright.

“If you buy the cattle today and pencil them out on the futures, there’s no profit left in them. But guys expect that the market for finishers could get better, and you have to buy the incoming inventory when it’s available.” [email protected]

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“I would say that things are looking better.”

– BEN CAINES

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