Many of you probably remember the old Kenny Rogers song from the late 1970's called "The Gambler". It was a popular hit for Rogers and the story in the song was actually developed into a movie. I suppose I just dated myself a bit with this reference! Regardless, the reason I mention this song is that the lyrics have real meaning for today's cow-calf producer and decisions made with heifers from the 2012 calf crop.
Consider a few of these lines from the song: ""If you're gonna play the game, boy, ya gotta learn to play it right."; "Now ev'ry gambler knows that the secret to survivin' is knowin' what to throw away and knowin' what to keep."; "'Cause ev'ry hand's a winner and ev'ry hand's a loser,"; and the classic "You got to know when to hold 'em, know when to fold 'em, know when to walk away and know when to run." While the song refers to gambling while playing cards, the lyrics could just as easily be used by the cow-calf producer when making decisions regarding the 2012 heifer calf crop.
The easy decision with this year's heifer crop would be to take advantage of high feeder cattle prices and cash them in. USDA and CattleFax reported that for the week ending October 5, 2012, 550 lb. feeder steers were bringing $79/head more and 750 lb. feeder steers were bringing $68/head more than the same time period in 2011. Yes, these are steer prices but heifers are still seeing higher prices as well compared to a year ago. Even with historically feed costs, the price for feeder cattle remains strong because there simply are too few cattle to meet the demand.
The fact that we are in such low numbers of beef cattle in this country should also give the producer a reason to consider retaining heifer calves for herd additions/replacements or for future sale opportunities. Numbers have dwindled in this country for a variety of reasons including feed costs, the competition for land, and producers retiring from the business to name a few. However, the most significant reason for the reduction in numbers over the past few years is that a large part of the United States where cow-calf production takes place has experienced significant drought conditions.
Certainly drought was the dominant topic throughout the country this year. Many parts of the country experienced the worst conditions seen since the Dust Bowl years of the 1930's. The impact of the drought has been felt far and wide throughout the cattle industry. Large numbers of animals have been sold to deal with the reduced amount of forages and grains available to feed our beef herd.