EXECUTIVE CORNER
PAYDAY
by Darrell Wilkes, Ph.D., International Brangus Breeders Association (IBBA) executive vice president For a lot of people in the cattle business, their annual payday is just around the corner. Spring-born calves will be flooding into auction barns all over the country. Some sellers will be happy, and others will be disappointed. Some 5-weight calves will top $2/lb. and gross over $1,000 per head, while others will sell for a lot less. Some groups of calves will have dozens of bidders trying to buy them, while others will have very few. The calf market is driven by ORDERS. While a lot of family-sized backgrounders and stocker operators do their own bidding and personally purchase all the cattle they take in each year, a huge number of calves are purchased by order buyers. Order buyers follow orders, literally. If the feedlot they’re buying for says they want weaned and vaccinated calves, that’s all the buyer will bid on. Period. It doesn’t matter that there’s a pretty good set of bawling, unvaccinated calves standing in the sale ring and the price is cheap. If they don’t have an order for those, they won’t bid on them even if they’re “too cheap.” The industry’s infrastructure is strained every year in October, when millions of calves flood the market. The infrastructure of bunk space and/or grazing land is, of course, finite. It can only handle so many cattle, and when the
16
October 2021
infrastructure is strained and people simply cannot handle any more calves (especially bawling, unvaccinated calves) the bidding subsides and prices fall. Historical data shows that October is the worst time to sell calves, but that’s when most calves are sold. It makes no sense, of course, but it keeps happening. CattleFax reports that, on average, calf prices in December are about $8/cwt higher than calf prices in October. In some years, like 2020, the difference was $15/ cwt. Their data also shows that a calf with two rounds of modified-live vaccination and is weaned more than 45 days, will fetch at least $100/hd more than a calf that is sold right off the cow or even a calf that is weaned but is sold 28 days or less after weaning. So, why is the executive at a breed association writing about commercial calf marketing issues? It’s because these are your bull customers. Their success is your success. It can be no other way. Some of the most successful seedstock producers that I know spend as much time helping their customers market their calves as they do marketing their own cattle. Actually, I said that wrong. When a seedstock producer is helping his or her customers market their calves more (continued on page 18)
