Livestock Situation and Outlook Ag Trends Seminar September 11, 2006

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Livestock Situation and OutlookAg Trends
Seminar September 11, 2006

• Tim Petry
• Livestock Economist
• www.ag.ndsu.edu/aginfo/lsmkt/livestock.htm

09-08-06
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As we know, there are known knowns. There are
thingswe know we know. We also know there are
known unknowns. That is to say we know there are
some things we do not know. But there are also
unknown unknowns, the ones we dont know we
dont know. -- Donald H. Rumsfeld, Secretary of
Defense Department of Defense news
briefing February 12, 2002
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Livestock Marketing Information Center Data
Source USDA/NASS
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Commercial Beef Production
Total Cattle Inventory
Livestock Marketing Information Center
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Livestock Marketing Information Center
Weights Will Remain Heavy
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Cyclical Rebuilding Is Continuing!
Livestock Marketing Information Center Data
Source USDA/NASS
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Long, Slow Road to Export Recovery
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Source LMIC
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U.S. Drought Monitor
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Livestock Marketing Information Center
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Livestock Marketing Information Center
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SF_LS766 Sioux Falls, SD
Thu Sep 7, 2006 USDA-ND Ag
Market News Stockmens Livestock Exchange -
Dickinson, ND Feeder Cattle Weighted Average
Report for 09/07/2006 Receipts 1527 Last
Week 407 Year Ago 1361 Today Stockmen's
featured a feeder calf along with yearling
special. New crop calves sold on a strong market,
with fewer offerings of yearlings than two weeks
ago selling on a firm market. Steers made up 6
percent of the run heifers 44 percent.
Offerings over 600 lbs totaled 58 percent. Next
week will be a feeder special featuring
Holsteins. Feeder Steers Medium and Large 1
Head Wt Range Avg Wt Price Range
Avg Price 18 442 442
140.25 140.25 Calves 18
452-471 461 134.00-140.00 137.58
Calves 15 495 495 135.25
135.25 Yearlings 41 503-540
519 133.50-135.00 134.31 Calves
32 563-585 574 125.00-132.75
130.66 Calves 60 597 597
125.75 125.75 Yearlings 19
604-645 613 121.75-127.00 125.84
Calves 76 703-705 703
112.35-118.00 112.87 26 752-790
770 117.00-119.75 118.36 32
842 842 112.25-112.75 112.50
14 858-871 866 111.75-114.50
113.53
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Livestock Marketing Information Center
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Where Are Corn Prices Headed?
Historically, 10 cent change in corn equals a 1
change in fall calf prices.
Ethanol?
How will higher corn prices due to ethanol demand
affect cattle prices?
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What Will a 550 lb Steer Be Worth This Fall?/cwt
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Livestock Marketing Information Center
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Source LMIC
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Source LMIC
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Livestock Marketing Information Center
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Breakeven Prices for 1300 lb Fed Steers750 to
1300 lbADG 3.5 lbs157 Days on Feed
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Price Risk Management Tools

• Cash forward contract
• Video and internet auctions
• CME futures
• CME options
• Livestock Risk Protection (LRP)
• Livestock Gross Margin (LGM)
• Which one or combination fits your marketing plan?

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AM_LS753 Amarillo, TX
Fri Aug 25, 2006
USDA-TX Dept of Ag Market News Superior
Video Auction - Tuesday-Thursday August 22-24,
2006 0fferings 120,000 Trade active and
demand moderate to good. Supply includes 34
percent feeder steers and heifers over 600 lbs,
60 percent of supply steers and 40 percent
heifers. Prices FOB based on net weights after a
2-3 percent pencil shrink or equivalent, with a
3-6 cent slide on yearlings and 4-10 on calves.
Deliveries current through March
2007.

Northcentral States
Colorado, Wyoming, Nebraska, Montana, North and
South Dakota and Iowa

Feeder
Steers Medium and Large 1 Head Wt Range
Avg Wt Price Range Avg Price
Delivery 1448 400-440 423
145.00-168.50 158.75 Oct 1593
450-490 466 133.00-154.00 145.31
Oct 3569 500-545 521
126.00-146.00 135.67 Oct 5278
550-590 566 118.50-138.00 129.74
Oct 405 600-625 610
119.00-128.50 125.76 Oct 2596
600-640 617 118.75-132.50 126.46
Oct Calves 381 650-670 659
122.75-130.00 127.23 Oct Calves
40 700 700 117.50
117.50 Oct Calves 130 775
775 117.75 117.75 Oct
68 850 850 112.75
112.75 Oct
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Premiums likely (but not consistent) for

• Verified shots (ND VIP)
• Natural (no antibiotics or implants)
• Source/age verified
• Weaned
• BQA
• Replacement quality heifers
• Check with your market before selling

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Livestock Marketing Information Center Data
Source USDA/NASS
U.S. Pork Production, 1930-2005
Trend 1.5/year
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Average U.S. Hog Carcass Weight, 1930-2005
Litters Per Sow Per Year, 1930-2005
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(No Transcript)
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Iowa Farrow to Finish Profits, 1994-2006
Why renewed interest in hog production in North
Dakota?
29 consecutive months of profit, longest since 33
months in 1976-79
Source John Lawrence, Iowa State University
Iowa-Minn Live Hog Price ForecastNegotiated Base
Price Per Live Hundredweight
actual price prior day purchased
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Livestock Marketing Information Center Data
Source USDA/NASS
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Livestock Marketing Information Center
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Questions?