Latest / CattleUSA Daily / 282: Volatile Week in the Cattle Market: Cash Drops, Feeders Hold Strong with Samantha and Andrea

Transcript

282: Volatile Week in the Cattle Market: Cash Drops, Feeders Hold Strong with Samantha and Andrea · CattleUSA Daily

• 0:00
  In today's cattle market recap episode, we are bringing on
• 0:03
  Samantha and a new guest, Andrea to come on and talk about the
• 0:09
  cattle markets, what we have been seeing over the past week,
• 0:12
  what we're seeing now and then some thoughts going forward as
• 0:15
  we go into the rest of spring as well.
• 0:17
  Andrea also does some really great commentary on our grain
• 0:21
  markets, everything that we're seeing there, and just some
• 0:24
  continued thoughts on that and you guys kind of know the drill
• 0:27
  at this point. The theme of the cattle market
• 0:30
  right now is volatility. Unfortunately for all of us, it
• 0:34
  has been a little bit of a wild week, both on the cash side and
• 0:38
  on the board. And these ladies do an amazing
• 0:40
  job of just recapping everything that we have seen over the past
• 0:43
  week and the effects that we've seen on the cattle industry as a
• 0:46
  whole. Before we hop into today's
• 0:48
  episode, if you are watching or listening on any of our podcast
• 0:51
  platforms, make sure you take a second to go subscribe to the
• 0:54
  channel, like this episode, rate and review the show, make sure
• 0:57
  you're following it, share it with a friend.
• 0:59
  Do all of those things because guys, doing all of those things
• 1:03
  helps us continue to grow this podcast and reach more people
• 1:06
  within the cattle industry and make a wider impact and truly
• 1:11
  bring forth the purpose of this podcast to more producers in the
• 1:15
  industry. We appreciate all of you for
• 1:17
  being here and for being here with us for over a year now.
• 1:21
  Cannot believe it's been that long.
• 1:23
  But if you could do all of those things, it would really help us
• 1:27
  just continue to grow this podcast and reach more people.
• 1:30
  Without further ado, let's go ahead and hear from Samantha and
• 1:34
  Andrea. Welcome to the Cattle USA Daily
• 1:40
  podcast. Your go to source.
• 1:42
  For the latest livestock markets, industry insights and
• 1:45
  the updates shaping agriculture today, I'm your host Lauren
• 1:48
  Moylan, a passionate advocate for agriculture.
• 1:50
  Here to keep you. Informed and connected.
• 1:53
  Now let's dive into today's episode.
• 2:02
  Samantha, Andrea, good morning. How are you both doing today?
• 2:06
  Andrea, I hear you guys had to kind of button down the hatches
• 2:09
  last night for a little bit of a storm that came through.
• 2:11
  Yeah, yeah, we're doing good. We made it through.
• 2:13
  My sister messaged me at midnight and said there's a
• 2:16
  tornado funnel above you. And I was like, Are you sure?
• 2:20
  Do I really need to go to the basement?
• 2:22
  And then 5 minutes. Later it was the.
• 2:23
  The town over. East of us, but.
• 2:25
  As far as I know, everything went went OK for everybody and
• 2:30
  it didn't actually touchdown. So we're just getting some much
• 2:33
  needed. Moisture, Absolutely.
• 2:35
  Miss Samantha, how are you doing this morning?
• 2:37
  Good, good. Traveling this morning down in
• 2:40
  Dodge City at the Sale Barn. I would, if this was going out
• 2:42
  immediately, I'd say come down to the Sale Barn in Dodge City
• 2:45
  and see me. But there's always next week,
• 2:47
  so. If there is absolutely and
• 2:50
  Samantha, this is going out immediately.
• 2:51
  So it is going this. Is going on.
• 2:53
  With Yeah, go see Samantha at the sale barn.
• 2:56
  Yeah, bring your trailer. Get a load of cattle bot.
• 2:59
  There you go. Oh.
• 3:00
  My gosh, I love it. Amazing.
• 3:01
  Well, how are first and foremost, Andrea, this is your
• 3:05
  first time on the podcast with us.
• 3:07
  We kicked Dan to the curb today and I would love it if you could
• 3:11
  give it a little bit of an introduction of yourself, who
• 3:13
  you are, just a little bit of your background for our audience
• 3:15
  members before we dive into the markets today.
• 3:17
  Sure. Andrea Van Horn.
• 3:18
  I live in Butler, MO so grew up in a strange little town called
• 3:22
  Peculiar, Missouri, not very far from here.
• 3:24
  Insert the same joke that I've heard my entire life, like, oh,
• 3:27
  that's odd. But I grew up, you know, raising
• 3:30
  Semental cattle on a pretty small operation.
• 3:32
  Have worked on cattle operations in the Sandhills of Nebraska,
• 3:35
  purebred operations in Indiana, Oklahoma, Texas, Kansas, Kind of
• 3:39
  manageable cooperative here in Butler.
• 3:41
  That's when I met my husband. So I planted some roots after
• 3:44
  that. But because if not, I was going
• 3:46
  to head out to Montana, that that was my cowgirl dream.
• 3:49
  But I have a background in green, green buyer for several
• 3:51
  years for Cargill. Also have a background in
• 3:53
  fertilizer. So worked at Adm and then my
• 3:56
  husband and I own and operate registered Semental, some Angus
• 4:00
  and partially commercial herd here in Butler.
• 4:02
  So I've been in been in the cattle world my whole life.
• 4:05
  It's my passion, it's my love and happy to be here with Cattle
• 4:08
  USA. Very excited to have you and
• 4:11
  excited to get some of your commentary today on what we've
• 4:13
  been seeing on the markets the past week.
• 4:15
  But Samantha, would you like to take it away and kind of give us
• 4:17
  a little bit of a recap on what we have been seeing over the
• 4:20
  past week and what we're seeing right now?
• 4:22
  Yeah, you bet. We got a little bit beat up on
• 4:24
  cash cattle in the futures board on Friday and just showing some
• 4:28
  weakness late last week and then that carried over into Monday.
• 4:31
  Overall, the market as a whole last week in your cash vats was
• 4:34
  238, mostly 2:38 to 2:42. So that's about 3 to $6 lower
• 4:39
  across the board. There was some trade that was
• 4:42
  below 238, just a handful, not anything to really say much of A
• 4:46
  market one way or the other. There was some at 2:33, but like
• 4:50
  I said, not much of A market there.
• 4:52
  The weighted average settled around 2:39 and some odd sense.
• 4:54
  So that gives you an idea kind of where that average settled in
• 4:57
  and where most of that trade took place.
• 5:00
  Feeder cattle kind of trailed off of that Monday.
• 5:03
  They were a lot softer going through the barns, except for
• 5:05
  your stock or feeder calves, all those those yearlings, there's
• 5:08
  been huge demand for them. They were as much as 10 to $20
• 5:12
  higher in some areas. Some other weight classes took a
• 5:15
  little bit of a nosedive there at the beginning of the week.
• 5:18
  But mostly, I mean, we're we're reaping some of the benefits of
• 5:21
  this recovery in the market on Tuesday.
• 5:23
  So that's been awesome. I mean, we look so much at the
• 5:26
  markets and all this short term things are the markets so quick
• 5:30
  to react first and thanks second.
• 5:32
  We're seeing a lot of that and we've seen plenty of it within
• 5:34
  the last few weeks. So just another one of those
• 5:37
  things where we've got a lot of these short term pressure on the
• 5:40
  cattle market. And we're kind of seeing the
• 5:42
  results of that first part of this week late last week with
• 5:45
  the the strike at the JBS plant in Greeley, Co and some
• 5:48
  different things going on that I'll kind of touch on here in a
• 5:50
  little bit. But overall market, but as a
• 5:52
  whole, we did have some cash cattle trade as low $5 lower
• 5:57
  from the week prior, the first part of this week.
• 6:00
  So I don't know if that'll set the market or set the tone for
• 6:02
  the market this week, but I guess we'll see.
• 6:05
  Like I said, there was some strength in futures yesterday,
• 6:08
  so maybe they'll playoff of that.
• 6:10
  But I think if the Packer thought that the cattle were
• 6:13
  going to be a little bit cheaper this week, they probably
• 6:15
  wouldn't have gotten as many baht last week.
• 6:17
  They bought a lot of cattle last week.
• 6:20
  They got a lot of inventory secured for 15 to 30 day
• 6:22
  delivery and so they're scheduling those cattle ahead.
• 6:25
  Like I said, if they thought the market was going to be cheaper
• 6:27
  this week, they probably would have held off some.
• 6:29
  But we are seeing about $5 off of last week's trade.
• 6:33
  So we'll kind of see how that plays out late week.
• 6:35
  Reiterate what she was saying that there are still feeders out
• 6:38
  there buying that this market with the volatility that we have
• 6:41
  and the instability that it seems that we have with, you
• 6:44
  know, tweets going out or any box beef coming in, any Iranian
• 6:48
  news coming through Greeley Co. It does have an effect on the
• 6:52
  market. But our bounce back seems to be
• 6:53
  pretty quick and strong as opposed to what it was about 3
• 6:56
  months ago. It seems to come back a little
• 6:59
  bit faster. We recovered about half of what
• 7:02
  we lost on Monday on Tuesday. So I have seen some folks in the
• 7:07
  area go ahead and go out to sale barns and they're like, hey,
• 7:09
  while the market's down, we're going to go ahead and buy some
• 7:11
  feeders. Some backgrounders are working
• 7:13
  on getting back to full capacity, taking advantage of a
• 7:16
  little bit of a dip in the market.
• 7:17
  But that tells me that they have faith and and the strength for
• 7:20
  the long term term. So just seeing some action as
• 7:22
  far as that goes on the on a local level.
• 7:25
  Yeah, absolutely. I think that we can kind of see
• 7:27
  that across the board right now that we've seen a lot of
• 7:29
  volatility in this market over the past year and just
• 7:33
  everything that we have been seeing there.
• 7:35
  But it is the markets going to do what the markets going to do.
• 7:37
  And we do bounce back. And it's encouraging to see that
• 7:41
  even though we have seen a little bit of a dip on the cash
• 7:43
  front over the past week, that the numbers are there proving
• 7:46
  that we're on the up and up again.
• 7:49
  Yeah, exactly. I've been a little surprised to
• 7:51
  see how strong receipts have held into spring.
• 7:55
  A lot of people out there going to tail off.
• 7:56
  I was personally in that boat, but we're still in seeing some
• 7:59
  pretty large consignments. I mentioned last week around
• 8:01
  here 3000 to 5000 heads, some places are as as up as 10,000
• 8:06
  heads. So good numbers still.
• 8:09
  And when the markets down, people seem to tend to get their
• 8:11
  cattle to town quicker than when the markets good.
• 8:14
  Everyone's kind of panic selling.
• 8:16
  So we're seeing a little bit more of receipts this week than
• 8:19
  we did last week. So that's kind of what what my
• 8:22
  thoughts are there. Other than that, there's just a
• 8:23
  lot going on in the cattle market and outside of the cattle
• 8:27
  market. We talked about war in the
• 8:28
  Middle East and the pressures there.
• 8:30
  I won't put too much focus on that here today because I mean,
• 8:33
  Trump's already come out and said that this war will be very
• 8:35
  ending very soon. That's what a lot of us were
• 8:38
  already thinking. We know our leadership superior,
• 8:40
  our military superior. So not really a huge pressure
• 8:43
  point. We saw a dip in stocks.
• 8:45
  We saw some slightly higher oil prices and some different things
• 8:48
  maybe inflation tick. But like I said short term
• 8:51
  effects probably will revolve it resolve itself and within the
• 8:55
  next week or two as the conflict kind of settles off in the
• 8:58
  Middle East. And as far as other current
• 9:00
  market news, there was a New World screwworm sterile fly
• 9:03
  facility. The USDA announced that it was
• 9:06
  going to start construction in Edinburg, TX.
• 9:09
  I think the cattle cartels down South of the border kind of just
• 9:12
  shrugging it off. I mean, they're going to pull
• 9:13
  out every tool they've got in their toolbox to keep that
• 9:16
  border closed because they're making a lot of money off of
• 9:19
  beef. I mean, that's what they're
• 9:21
  making money off of. So they're going to put every
• 9:23
  effort forward that they can to keep that border closed.
• 9:25
  Other than that, I mean, main topic of the week, the main
• 9:28
  topic of the last 3-4 weeks has been this strike in Greeley, Co
• 9:32
  at the JBS processing plant. And you know, I've kind of told
• 9:36
  you guys about my thoughts there in past visits, but the cattle
• 9:40
  market like I said, it's always so quick to react first and
• 9:42
  think second. When you look at kill numbers
• 9:45
  year over year. I mean if we were like I've said
• 9:47
  before, if we were up 600,000 head a week and kill numbers,
• 9:50
  this plant strike, this plant closure would have way more of
• 9:53
  an effect on overall slower capacity.
• 9:55
  But a lot of these plants, they aren't running to capacity as
• 9:58
  is. I think the union had a plan to
• 10:01
  initially start. They put a strike start date for
• 10:04
  the strike starting March 6th and then and then they ended up
• 10:07
  closing the doors a week early. JBS came out and said they were
• 10:10
  doing some maintenance, some repairs, maybe some upkeep, some
• 10:13
  different things. A lot of people are saying that
• 10:15
  JBS kind of just had their feel and said if you, if you want to
• 10:18
  strike, if you don't want to work, then just go.
• 10:21
  I mean, just go now and he'll see what it's like.
• 10:23
  But so we're seeing the effects of that a little a week early,
• 10:26
  hence the reaction on the futures board and all these
• 10:28
  different things. Like I said though, is it a big
• 10:30
  deal to the market? I don't think so.
• 10:33
  It's been a big deal, but I think it's just going to be a
• 10:35
  short term effect that we could easily absorb the kill
• 10:37
  elsewhere. A lot of these cattle are still
• 10:39
  getting, all these cattle are still getting killed with just
• 10:42
  maybe slight delivery delays. So they are getting killed.
• 10:45
  There's going to different plants for it.
• 10:47
  Like I said, we've got the capacity, the capacities,
• 10:49
  capacities there. I think they noted the overall
• 10:52
  slaughter capacity at Max for that JBS, the slaughter plant
• 10:57
  was 6000 head a week or 6000 head per day, excuse me.
• 11:00
  So that's about 3030 thousand head per week if they were
• 11:03
  running to maximum capacity and they're probably not.
• 11:07
  So if you're figuring, you know, 30,000 a week and we're already
• 11:11
  60,080 thousand back in slaughter year over year, that's
• 11:15
  small potatoes. But I think if anything, these
• 11:18
  other plans, like I said, they're going to run a little
• 11:20
  more efficiently. These Packers that have been
• 11:22
  complaining about margins, they're going to see better
• 11:24
  margins from higher beef prices and lower cash cattle.
• 11:28
  So if anything, I mean, they're just going to use it as an
• 11:30
  excuse to get cattle bot cheaper and kill, slash, kill to get
• 11:35
  beef prices higher. So and we're already seeing
• 11:37
  both. Yeah, I would echo what you said
• 11:41
  on that, that I really do believe that the effect that
• 11:43
  we're seeing on the market from this is from the drag out of the
• 11:46
  news headlines on it rather than the actual effect that we're
• 11:49
  going to see from the plant itself being closed down.
• 11:52
  Yes, they they do kill 30,000 a head, 30,000 head a week.
• 11:56
  Excuse me, but like you said, Samantha, every other plant in
• 12:01
  the area is running at lower chain speeds right now.
• 12:05
  Some plants aren't even running full shifts right now, like we
• 12:08
  can easily absorb this in other areas.
• 12:11
  And so I really do see this just being a effect that we see on
• 12:15
  the market from a news headline standpoint, which hello, that's
• 12:19
  just the word of the that's the sentence of the past year,
• 12:22
  right? Like the market reacting on news
• 12:26
  headlines rather than how it's actually going to affect the
• 12:29
  market. Like we can go back to Trump
• 12:31
  being like we're going to bring in Argentina beef or when we're
• 12:35
  talking screwworm. Anytime it hits the headlines or
• 12:39
  anything like like that. It's truly one of those
• 12:41
  situations and scenarios where we see this market being so
• 12:45
  volatile and it reacts before it gets a chance to think.
• 12:49
  Absolutely. Yeah, I saw a deal on Facebook
• 12:53
  the other day, Rural Radio Network, they had posted a deal
• 12:56
  that said livestock analyst says he's skeptical of recent kill
• 12:59
  numbers. I know we've got less cattle,
• 13:01
  but is it this tight? Is it this short in numbers to
• 13:04
  tail off of that? I don't think so.
• 13:06
  I mean, like you said, we've been cutting kill, kill numbers
• 13:08
  for quite some time. We are well below last year.
• 13:11
  A lot of times we're well even below the week prior.
• 13:13
  So I don't I don't think supplies are as tight as the
• 13:18
  processors are making it out to be them.
• 13:20
  I mean, really, like I said, they're trying to get live, the
• 13:22
  cattle bought cheaper, they're trying to slash kill to get box
• 13:25
  beef, cut out values higher. They bought a ton of cattle last
• 13:28
  week on lower cash, like I said, for that 15 to 30 day delivery
• 13:31
  window. But reality of it is if you're
• 13:33
  looking for transparency in the cattle market or in the cattle
• 13:36
  industry as a whole, don't go to the packing industry for it.
• 13:40
  I mean, Packers and transparency typically don't go hand in hand.
• 13:43
  So I don't think supplies are near as tight as the Packers are
• 13:47
  making it out to be by any means.
• 13:48
  The cattle are there and they're just not buying as many.
• 13:52
  Absolutely. Andrea, do you have any
• 13:53
  thoughts? Yeah.
• 13:55
  On that note of accurate reporting on their end is bad
• 13:57
  for business. So if they can use the
• 14:00
  volatility that we have in the market to sway things in their
• 14:03
  favor, they're going to. And that's just, I mean the name
• 14:06
  of the game as far as that goes. But if anybody has any trust or
• 14:09
  Cape like confidence that they're going to do the right
• 14:12
  thing for beef producers, I would highly question as to why
• 14:15
  because they it's not typically their MO.
• 14:19
  Would you like to touch on our grain markets or anything else
• 14:21
  that we're kind of seeing? Yeah, interesting thing happened
• 14:24
  yesterday. May futures didn't move at all.
• 14:27
  We have all of this energy crisis that's going on and
• 14:30
  typically in the past that that would mean more ethanol
• 14:33
  production as we see crude oil go up by the barrel.
• 14:36
  Well, crude oil came all the way back down again.
• 14:39
  So that was a short term volatility.
• 14:41
  Beans were up 7 cents a bushel yesterday, so it put them at 12
• 14:44
  O3 for futures on the May board, which is quite a bit more life
• 14:49
  than what the the bean market has seen prior to any of the
• 14:54
  China talks or tweets or anything like that.
• 14:56
  And we haven't had a lot of change on the S and DS.
• 15:00
  We are really good at what we do here in the the United States.
• 15:03
  We're really good at growing corn.
• 15:04
  We're really good at growing beans.
• 15:06
  What we haven't done really successfully the last couple
• 15:08
  years is find end users for those products.
• 15:11
  So bean meal at crush plants. We especially with the Mexican
• 15:15
  border being shut down, so we cut off that leg.
• 15:18
  With China not coming to the table and having, you know, any
• 15:21
  trade deals with us thus far for the last several years, there
• 15:24
  aren't a lot of places to go with being male.
• 15:27
  And, and once it reaches a certain level, you would think
• 15:30
  that you would see it make it into more rations.
• 15:33
  But with corn where it's at in the market, it's just so cheap
• 15:36
  to have DDGS or chopped silage. That's what we did last year.
• 15:39
  We we chopped all of our corn for silage because we could walk
• 15:42
  it off the farm for more money than what we could haul it to
• 15:44
  town. I think you're going to continue
• 15:45
  to see that obviously cattle numbers are down.
• 15:48
  So you're not going to see an overconsumption of, of being
• 15:51
  utilized as silage and having that take an overall effect on
• 15:55
  the market. But I think maybe some friend
• 15:57
  shakers might happen this year, some some more wheat, some more
• 16:02
  sedan and and try and get some more specialty crops in the mix
• 16:06
  because we haven't successfully generated another end user for
• 16:10
  for our products. So as long as the S and DS don't
• 16:13
  change, I don't see much volatility happening.
• 16:15
  Obviously, beans are going to continue to climb a little bit
• 16:18
  as we have this Iranian dispute because it equals energy with
• 16:23
  the biodiesel on that end. But outside of that, it's pretty
• 16:29
  stable, especially on the corn side.
• 16:31
  So I think for cow producers we can expect similar feed prices
• 16:35
  and inputs carrying throughout the summer, but I know that's
• 16:38
  not what the grain farmer wants to hear.
• 16:41
  Yeah, for sure. Samantha, any other thoughts on
• 16:44
  just the markets or what we've kind of been seeing over the
• 16:46
  past week or just thoughts as we look forward into the rest of
• 16:50
  March? I think beef prices have just
• 16:52
  been a really hot topic lately. I mean, Hector, they're pushing
• 16:56
  $4.00 if we keep this thing going up.
• 16:59
  Just to tail off of that for a minute, just on some charts that
• 17:02
  I was looking at yesterday and we talked about so much the
• 17:05
  attention that the cattle industry has got nationwide,
• 17:08
  whether it be from the consumer, whether it be from politicians,
• 17:11
  headlines, all these different things.
• 17:13
  And a lot of the reason, I think 4 main reasons are why we are
• 17:16
  seeing that first and foremost, like I said, high beef prices,
• 17:19
  that's it's getting a lot of time.
• 17:20
  Your producer would argue that beef prices aren't high given
• 17:23
  all the input costs and all the different things that go into
• 17:25
  beef production. And unfortunately, a lot of your
• 17:27
  producers aren't getting what you're paying at the retail
• 17:30
  counter or at the restaurant or anything like that unless you're
• 17:34
  buying director. And if you don't have that
• 17:36
  access, then you're probably not buying direct.
• 17:38
  And if maybe you do have that access and you don't know about
• 17:40
  it. So just a lot of different
• 17:41
  pressure points there. But seasonally, it's just crazy
• 17:44
  to see the support that we're still seeing in the cut out.
• 17:47
  Like I said, Packers have slashed kill a lot to help
• 17:50
  prices in the cut out and retailers are kind of stressing
• 17:52
  getting their inventory bought. So it's been kind of a perfect
• 17:55
  storm for the Packer, discounted cash, cattle, high beef prices
• 17:59
  and different things. But if you look at that trend
• 18:02
  year over year as of this going to be a few days off because I
• 18:04
  pulled it from yesterday and this is from March 12th as of
• 18:07
  last year. So a few days off.
• 18:09
  But just a general average choice box, we've cut out values
• 18:13
  Tuesday were 39467 versus 3/21/10 a year ago.
• 18:17
  That's crazy. And select box, we've cut out
• 18:21
  values 38677 Tuesday versus three O 753 a year ago.
• 18:27
  So there's a there's a few different things at play.
• 18:30
  We may not see that spread between choice and select box.
• 18:33
  Cut out values widen as much even as we go into spring
• 18:36
  grilling season because select product is pushing 10% or lower.
• 18:40
  There's a lot less like product out there and there's a lot more
• 18:43
  choice product out there. I mean a few weeks ago we hit an
• 18:45
  all time high of cattle grading choice or higher 89.4%.
• 18:50
  So we are seeing some different things, but I think from a
• 18:52
  seasonality standpoint, it's really crazy to see the support
• 18:55
  and box beef cut out values. Another thing that we're kind of
• 18:57
  seeing with all this attention around the cattle industry and
• 19:00
  all these different things is obviously supply is historically
• 19:04
  tight. Like I said, it's probably not
• 19:05
  as tight as the Packers making it out to be, but of course it
• 19:08
  is still tight. And who knows if we'll ever
• 19:10
  rebuild the cattle, mark the cattle domestically.
• 19:14
  I mean, the big thing that me and my dad were talking about
• 19:17
  the other day, a lot of people are grazing yearlings, stalker
• 19:21
  feeder cattle. That's the market they're
• 19:22
  getting into. A lot of people are straying
• 19:24
  away from cow calf production. And that's fine.
• 19:27
  I mean, that's fine to feed out yearlings.
• 19:28
  There's nothing wrong with that. But the cow calf guys, that's
• 19:31
  what's going to rebuild the cow herd.
• 19:32
  So, I mean, yes, head for retention, the indicators are
• 19:35
  there, but you figure the same grass that you would graze your
• 19:38
  Cal Kafka on to build the domestic herd is, is being taken
• 19:42
  up elsewhere. So there's just a lot less land
• 19:44
  available for that in the long term.
• 19:46
  Other than that, just disruptions in the industry as a
• 19:49
  whole are increasing. All you guys know.
• 19:50
  I mean, plant strikes, you've got fires, drought, market
• 19:54
  concentration, New World, screwworm disease, that's
• 19:57
  disease threats, all these different things.
• 19:59
  And then just politics around food supply.
• 20:01
  I mean, Secretary Rollins has come out.
• 20:03
  A lot and talked about how it is a national security issue that
• 20:07
  we cannot source beef within the United States.
• 20:11
  We are drastically outsourcing for beef.
• 20:12
  And of course we have to do that because like I said, select
• 20:15
  product is at an all time low. We don't have a lot of it in the
• 20:18
  United States because our quality is just so good.
• 20:21
  But it is concerning our domestic cattle herd, the
• 20:24
  numbers, food supply as a whole, it's it's definitely concerning.
• 20:27
  So just to tail off of that that I mean just there's a lot of
• 20:31
  different things drawing attention to the cattle
• 20:33
  industry. And in the past, you know, when
• 20:35
  we've seen all this attention, all this government
• 20:37
  intervention, it doesn't tend to be good for the cattle market.
• 20:39
  Whether that government intervention is in good efforts
• 20:42
  or bad efforts, typically bad. We just we don't see a lot of
• 20:46
  positive things from that. So that's where I come in from a
• 20:49
  risk management standpoint. And I say, you know, yeah, the
• 20:52
  fundamentals may be bullish, they are bullish, but
• 20:54
  commodities don't have to always trade that in a commodity traded
• 20:57
  market, there's a lot of uncertainty and there's a lot of
• 21:00
  different things at play. So that's where just be weighing
• 21:02
  out your options like livestock risk protection, trading on the
• 21:06
  board, whatever those different risk management options are.
• 21:09
  One thing that I want to point out, it's just you almost need
• 21:12
  to utilize it like crop insurance.
• 21:14
  I think LRP and PRF, the Rand insurance should both be
• 21:17
  utilized like crop insurance. You know, you put it on every
• 21:19
  year. Crop insurance you do regardless
• 21:21
  of the weather, regardless of the markets and all these
• 21:23
  different things at play. LRP and PRF should be used
• 21:26
  pretty much the exact same. I know a lot of people that put
• 21:29
  LRP on for one year and then it didn't end up paying out because
• 21:32
  the market went higher there and they didn't put it on again.
• 21:34
  But the thing of it is, I mean, you put it on for a safety net.
• 21:38
  You put it on for that one year, 2 years, 2-3 years, whatever,
• 21:41
  that the market fell out of bed and then you're happy that you
• 21:44
  did have that protection on. So just utilize that.
• 21:47
  I always tell people, you know, you wouldn't put insurance on
• 21:50
  your barn and then hope your barn burns down.
• 21:52
  So just like you wouldn't put protection on your cattle and
• 21:55
  then hope the market falls out of bed.
• 21:56
  So utilize that, use it as a safety net because at one time
• 22:00
  the market falls, it's going to save your ass.
• 22:03
  And just to piggyback off that a little bit, I've been talking to
• 22:06
  a lot of producers about what they're doing right now and
• 22:08
  what's happening on our own operation is fertilizer going
• 22:11
  out. Whenever I talk to producers
• 22:13
  unanimously across Arkansas, Kansas, Missouri, Iowa, it's
• 22:17
  that our inputs are higher, inputs are higher, inputs are
• 22:19
  high. I talked to a guy that said that
• 22:21
  his Anhydras was $300 more a ton delivered this year than it was
• 22:24
  last year. And that's because of certain
• 22:27
  conglomerates controlling the entire supply.
• 22:29
  They can charge whatever they want and they continuously up
• 22:34
  the price more and more. So to Samantha's point, if
• 22:37
  you're not using risk management tools and the market does take a
• 22:41
  fall, you still have those set input costs that are increasing.
• 22:44
  And so I just don't want producers to get in a position
• 22:46
  to where they can't cover. Yeah, absolutely.
• 22:50
  I think that you both said it perfectly.
• 22:52
  But it is not a situation in scenario where you're sitting
• 22:55
  there and you get coverage and you're hoping that the market
• 22:57
  falls out of bed and that you're hoping things go bad so that you
• 23:01
  can get that claim. It's there just in case it does.
• 23:04
  It's there just in case that rock does end up falling and we
• 23:07
  get a rock slide and the market just absolutely tanks out.
• 23:09
  Is there anything else that we need to cover today that we have
• 23:12
  not hit on ladies on as far as the market is concerned, just
• 23:15
  across the board? Any news, anything like that
• 23:17
  that we haven't touched on? I think that's it.
• 23:19
  I'll quit fighting the sun over here.
• 23:22
  I looked up at one point and saw you getting just some really
• 23:25
  nice golden sunrise rays on you over there.
• 23:28
  Made this lighting is so. Much better.
• 23:31
  I know it's it's so picturesque on Samantha's end.
• 23:36
  Getting that sunrise in Dodge City, KS.
• 23:38
  I love it. Well, I hope my rain heads your
• 23:40
  way. Yes, for sure.
• 23:42
  We are sending it all your way Samantha, that is for sure.
• 23:45
  I know you guys desperately need it in Western Kansas.
• 23:47
  For sure. Sending it your way.
• 23:49
  But Andrea, thank you for your time today.
• 23:52
  Samantha, thank you as always. It was great catching up, great
• 23:56
  hearing all of your guys's thoughts on the markets and what
• 23:59
  we've been seeing over the past week and what we can do as
• 24:01
  producers. For all of you guys listening
• 24:04
  out there, everything that Samantha and Andrea talked about
• 24:07
  today, whether it be LRP, talking coverage rates, anything
• 24:11
  like that. All of those links are going to
• 24:13
  be down on the show notes where you can get a hold of either of
• 24:15
  them or another member of our team on the Cattle USA insurance
• 24:18
  side and just chat what works best for you and your operation.
• 24:22
  Guys, thank you once again for coming on to share your
• 24:26
  thoughts. And to all of our listeners, we
• 24:27
  will see you all next time on another episode of the Cattle
• 24:30
  USA Daily Podcast. Have a good one y'all.