Rainmaker

By Chris McClure, Contributing Editor

Sometimes we just need a little rain.

This past summer was dry across much of the West. New Mexico, where we had a fair number of cows, was in the grips of severe drought, which didn’t look to be letting up any time soon. My mind traveled to 2010-2011 when it seemed the temperature was near or above 100 degrees for day after day with a hot, dry southwest wind that never seemed to quit. It was that weather that drove me to uproot from the Texas Panhandle and relocate to northeast Texas where the grass was green, trees grew, and water just stood around in large lakes and ponds and sometimes even flowed across the land in creeks and rivers. It rained there. Rain grows grass. Grass is good for cows.

I was truly beginning to wonder why I moved back to the Panhandle this past January. Then it rained.

It is amazing how much blue and black gamma a half-inch of rain will grow. Just last week I was on one of the New Mexico ranches where we were weaning calves and just looked in wonder at the knee-deep grass that stretched for miles in every direction. I thought about the drive west from Amarillo and about how green it was, and it struck me how beautiful these Plains can be when the grass is green and the cattle have plenty of grazing.

I also thought about all of the fields of kochia and other weeds that were being swathed and baled for hay. I know of one feedyard that probably has 500 large square bales of kochia stacked that they have been blending with other hay as cattle feed. It reminded me how tight feed supplies became last winter and into the spring and early summer. The cost of gain soared and cattle that should have made some money were suddenly losing in a market where fats seem to be trading well below where global demand should dictate.

I know we all think about the market and grow frustrated that the “pinch point” of existing slaughter capacity is causing a lot of heartburn. There quite simply are more cattle available than necessary to meet the current ability to harvest them due to plant problems, labor issues, trucking issues and myriad other challenges created by this “pandemic” and aging infrastructure. On the other hand, global demand is at a point that those same plants have no problem selling everything they can produce at a premium price because they are unable, or unwilling, to supply at a level that would push prices back down for the consumer.

Our national cow herd was liquidating rapidly, which eventually would bring supplies in line with the capacity to harvest. Short term, it further suppresses prices, but longer term, it promises they will rise. Then it rained over many areas where cows were days from being loaded on a truck and shipped to points east where many would be harvested. They received a reprieve – at least for another season.

I was visiting with a friend in East Texas last week who complained that the regional feeder cattle sale to which he consigned part of his calf crop had gone to a 60-day weaning program requirement and now was requiring that all heifers more than 650 pounds be pregnancy tested open before they would be eligible for the sale. His complaint was that “someone else” is always dictating to the cow-calf producer how they should raise their animals. He tried to compare it to a car dealership where “you don’t pay the same for a Chevy as you do for a Cadillac!”

I had to remind him that if you don’t have the product the buyer wants, they will go elsewhere. His response was that he felt like he had superior genetics and did everything “right” with his herd management and weaning program yet got the same price as the guy down the road who only halfway managed his cattle.

He was right, but he was also wrong. When you comingle superior animals with inferior ones, you get the average. I suggested that he either endorse the new requirements to hopefully raise the value of everyone’s animal, or find a new channel for marketing his.

The issue of “the average” is one we really need to address as an industry. The packers like the fact that we manage our feeding to the average of the pen. They sort the results when they are in the box – that’s part of how they are making such a windfall right now. We saw a Choice-Select spread of more than $36 this past week – and it is September! (I know it will fluctuate wildly between the writing and the reading of this piece, but it gives perspective.)

The only way to deal with the wide variation in a pen is to find a way to narrow it – that means sorting and maybe sorting again. I think I heard the moans from many of you as you read that. It causes heartburn for nutritionists, veterinarians, feed foremen, managers and bookkeepers to think about sorting. It is the only way to narrow the distribution within a pen unless we start cloning large numbers of cattle.

I suppose all of this seems a bit of a downer, but that might be a good thing. It is in the difficult times that someone finds a new way to solve problems. It is in periods of extreme pressure that certain individuals figure out how to push on through despite the odds. They are the rainmakers. It’s time for another rain.

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