cows #s

[pritchh]

Cow @s are at 25 + year lows, More milk per cow and we drink less, less fluid milk.

Beef we eat as much as ever, but geet far more per cow/calf base unit.

Where does this tipping point come, when we over use vs. base #s?

We hit it in beef cows, must be close in dairy.

Corn is still flying, yet feeder futures stopped dropping. USDA guesses of course, no one knows for sure but my contention is the depressing era of 20170-2010, more feelings based than reality, though feeding margins were record low for a record time,  got to cow/calf guys and we have even less a cow base than we think.

Here we are with 6$ corn and feeders are way over summer and summer 09 prices.

That is yelling something IMO.

If corn ever dropped, I think FEEDERS will skyrocket.

Lives? If Dec futures takes out the recent low, I think they are a buy, demand is there, supply is not, the bill will reassert.

Pritch

[jrsiajdranch]

Here is the question tho.  Can the consumer pay more?  NZ is just screaming at th US for it's low dollar policy and Brazil is to.  WHy?  Cause they can't export into our mkt.  with the KIWI dollar trading at 80 to our dollar our product is actually cheaper than theirs!

So does that mean we can send cali powder to china cheaper than kiwi powder? Right now it seems so.

As far as the meats it is the same thing we are the cheapsupplier to buy from right now so the wold can come to usfor beef where as in the past our mkt. was one they could flood.

But with all those factors our products are high priced for our home consumers sssooo which happens first does the world buyp all the product that the US consumer can't affford or do we build stocks here that eventually become burdensome?

And then we have next week G20 smack down of the US with Germany and CHina ready to tag team us for our stupid dollar policy.  Could get real intersting from here on out.

Last week we gave up a lot in the milk mkts.  So I think we may be ready to move significantly higher in dairy.

[Artifice]

The markups are so high from a live at 98$ to retail or restraint

I think yes, the mkt can handle 130-150$ lives. 2) if the supply isn’t there it isn’t, so less supply and I think demand is far more inelastic vs. 20 yrs ago.

I could imagine 15% less beef  equaling 30-40% higher live prices.

Woww, FCF11 is up 5$ in 3 days, with corn barely off it high.

Artifice

[GoredHusker]

This is where I believe we are headed.  China loves to buy raw products from us, manufacture them, and then ship the finished product back to us.  They also have the ability to float their currency along with ours.  I'm guessing eventually with all these great crush margins they have on soybeans that they eventually flood our market with a finished product:  hogs.  They have us hooked on everything else, why not food?  Al Gore may eventually get his wish where we import all of our food rather than producing it here at home. 

All in all, everything I see coming eventually leads to WWIII.  However, I believe we will see some very strange bedfellows when this occurs.  Bernanke may be well versed on the Great Depression, but I'm not so sure he studied the aftermath enough.   

[jrsiajdranch]

Gored what do you see as the aftermath? 

How have cattle been karketed in the past few weeks are you guys fairly current or have you been holding some back?

[GoredHusker]

The aftermath of a war or the aftermath of China selling us meat?

As far as cattle marketing, I can't really say with any certainty as I only feed cattle in the winter.  I'm just now getting all of my lots full now.  From what I've read, most of the bigger lots had a significant amount of coverage in terms of feed feed costs.  Actually, this runup in corn price has been good for those covered because basis three months ago was 35 under and now is 75 under.  For the lots well covered on feed prices, I'm betting they're feeding cattle to big weights probably around the 1350-1450 range.  For the lots that have no feed covered, I'd be willing to bet they're very current and are letting loose around the 1150-1250 range.  Talking to several grain merchandisers, I hear the same thing.  They all claim that the cattle numbers just aren't there.  One of the biggest lots around me took 1.5 million less wet corn bushels in this fall than normal because this is how much they had left over from last year.  I'm assuming there's got to be a lot of pain out there as the largest order buyer is just days away from filing bankruptcy.  The only way I can see an order buyer going bankrupt is by not getting paid by feedlots.  The runup of corn prices this year pretty much put the nail in the coffin of any expansion at all for the next three years.  Most people don't realize that if you take out ethanol, corn demand over the past four years has been going down rather than up.  Even the cow/calf man is having to pucker up a bit now. 

[jrsiajdranch]

Yea eastern going down is really the biggest deal out there No body and I mean NOBODY is talking about what impact this is having on many of the small auctions and also the big pack who depended on the orderly buying to keep stuf moving.

i meant the aftermath of the great depression that you spoke of concerning Bernie.

And alot of the big guys in dairy have also reduced numbers they just aren't telling anybody cause those cattle are still sitting there as collateral.  Sucks to be their bankers.

[GoredHusker]

WWII basically occurred because of the hyperinflation Germany was sustaining and the leader they had at the time.  I've read article after article of Germans burning paper money to heat their homes because it was worth less than firewood.  Currently, it appears as though our printing presses are causing hyperinflation.  However, it isn't happening here.  We're causing hyperinflation in China.  China has been building a supreme military all the while.  If we continue down the path Bernanke has thus far chosen, we could eventually spin China back into the stone ages.  With the sheer amount of people they have and the military they have built, they will go hunting which I'm afraid leads to WWIII. 

What I truelly find both insane and stupid about our Fed policy is the fact that anytime the U.S. has seen big growth and prosperous times we had two things:  1)  cheap energy  2)  cheap food.  Considering the price of oil is pegged to the U.S. dollar, continuing to print more money will cheapen the dollar thus raising the price of energy.  The cheapening of the dollar will also cause food prices to escalate.  One could almost argue that Bernanke and the Fed is actually trying to cripple our economy rather than help it.  What I find odd is the fact that the Fed actually believes a cheaper dollar will help our trade deficit.  Considering the dollar value is within five percent of being at the all time low and we continue to set trade deficit records, it should be quite obvious that a cheaper dollar will not correct our trade deficit.  The Fed should realize that we don't as a country make anything anymore to export. 

[jrsiajdranch]

Wow I hadn't thought about CHinese hyperinflation!  now that is scary.  Good post many things to think about there. JR

[Artifice]

we had a BIG move

and it doesn't quit.

FEERDers getting scarce.