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North Central Texas | Yes I follow the corn price everyday. Supply & demand (10000 differnt variables from political unrest to drought to competitive protein and on and on) + the price of corn = what calves are worth. When we have retained it has been in times like now. Calves would not bring what we wanted and we fed. Contracted the calves and bought the corn up front. Played the board selling cattle and buying corn. Last few times cattle have broke even using the price we were looking for. Check from the broker made it nice.
The problem with a matrix on cow calf is there are too many varibles. Mace said that farmers and feeders try to hard. The problem with a farmer or feeder is that besides rain everything is constant. Add more of a to get b. Mix a little c and we get d. You pick a hand full of places to sell but are more likely with going to the comfortable place.
Then you find the cattleman. He will take risks that look huge to most but they are calculated. $4 corn moves to 5 and feeders will be more profitable at higher weights. Moves to 6 keep them till 8 and hit even better. Knowing when to hold and when to let go to add value. You could build a matrix and it would change everyday. | |
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