Drought Key To US Cattle Producer Decisions

US - Drought, or the lack of it, is seen as a key element in cattle production decisions through 2007, just as it was in 2006.
calendar icon 21 December 2006
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Dry conditions were blamed for forcing calves into feedlots at younger ages than cattle producers would have liked this year, and some market analysts are saying the lack of water short-circuited herd-building efforts.

U.S. Department of Agriculture cattle-on-feed reports in 2006 confirmed anecdotal evidence that the younger cattle were being sent to the feedlots early. As the drought carried over from 2005 in many parts of the U.S., the number of cattle placed into the feedlots in 2006 exceeded year-earlier volumes in every month except April and May, according to the USDA figures.

Market analysts and economists blamed the drought as it expanded back into areas that had seen an easing of conditions late in 2005 for sending cattle to the lots early. They also said continued drought likely would pressure the cattle industry to keep sending cattle to the lots earlier than they would under better conditions.

But it could even mean herd liquidations as producers are caught between burned up pastures on one hand and high-priced hay and corn on the other, market analysts said. The entire year could be a delicate balancing act as producers try to find the lowest-cost weight gain possible.

And if the feed famine continues in parts of the U.S., a profitable situation may not be possible, market analysts said.

Source: Agriculture Online

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