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Marketing your 2019 calves — Part 1

What does the marketing potential for my 2019 calf crop look like now?

Harlan Hughes 2

December 2, 2019

5 Min Read

As the grazing season progresses toward fall, my study herd manager is starting to think about marketing his 2019 calf crop. Grass has held up quite well this summer, and the calf crop is looking good. His question this month is: What does the marketing potential for my 2019 calf crop look like now?

Be a price watcher. The internet provides my study rancher the ability to check market prices once a day in five minutes or less. By checking daily (or even weekly), he should get a good feel of the general trend of market prices. I suggest that he keep a ledger of daily prices.

I routinely use two free programs that I put on my phone and tablet that allow me to quickly check market prices daily. These two program are:

  •  Cattle Market Central, available in the Google Play Store (see Feeder Cattle example, Figure 1, left side; and Live Cattle example, Figure 1, right side).

  •  Cattle Market Mobile, a daily email with daily cattle market and feed grain prices. Also available on Google Play Store.

Each program has its advantage. The first one presents a graph of daily prices for the last month that I especially like (Figure 1). The right side of Figure 1 gives me that day’s live cattle (slaughter) graph and the price change from previous day. The advantage of the second one listed above is that it gives the current prices of other commodities, such as corn and other grains.

Related:What's the best marketing option this cattle cycle?

Market Advisor | November 2019

Adjusting futures prices to cash prices. A rancher typically does not watch futures prices — he wants to watch feeder calf cash prices in his local area. The price difference between his local area and the futures market is measured as the basis.

Figure 2 presents the three-year basis table that I prepared for my eastern Wyoming-western Nebraska study rancher. It shows a three-year average basis for alternative weights of feeder cattle sold in his area.

The futures price is for a specific weight of feeder cattle (averaging 800 pounds), so I have calculated a basis value based on midmonth prices for eastern Wyoming-western Nebraska for the last three years for alternative feeder cattle weights. These are summarized in Figure 2.

Market Advisor | November 2019

These basis numbers allow my study herd manager to take the daily futures price for 800-pound feeders and localize it to his typical weaning weight. For example, if he typically weans 550-pound steer calves in October, and today’s futures price is $140 (see Figure 1), then he can add on the basis for 550-pound steer calves in Figure 2 ($32) and project his current sale barn price today for 550-pound steer calves at $172 per cwt.

Related:Early peek at marketing 2019 calves

If my study rancher wants to project feeder cattle prices around weaning time — say, mid-October 2019 — he can get the October ’19 futures price on his computer, as Feeder Cattle futures prices are published daily online.

For example, as this is being written, the October ’19 Feeder Cattle futures on Sept. 15 was $134 per cwt. Add on the three-year average basis of $32, and this projects a localized midmonth October ’19 feeder cattle price of $166 for 550-pound steer calves. This current projected price is $22 per cwt under what he received last year. But, the chart in Figure 1 shows an eight-day upward price trend. Stay tuned.

My expanded midmonth price projections. Each midmonth, I go to the internet and pull off that day’s futures prices for Feeder Cattle, slaughter cattle and corn.

I also generate a set of localized feeder calf price forecasts each midmonth. I do this by accessing the USDA published Nebraska sale barn summary for the midweek of each month, and I generate a statistical price equation relating feeder calf prices to weights. I integrate these alternative weight prices into my price forecasts adjusted by my localized basis values.

Figure 3 presents my mid-September planning prices shared with my study rancher. The yellow section is my price projections for fall 2019 through spring 2020.

Market Advisor | November 2019

The dark red numbers are the planning prices I use for grass cattle. For example, I show a spring ’19 price of $177 per cwt going on grass and a September ’19 price of $141 per cwt coming off grass.

Now for the answer to my study rancher’s question in the first paragraph: My September 2019 projected fall price for his weaned 550-pound steer calves is $163 per cwt. This is about $28 per cwt under last year’s Oct. 28 price. Let’s hope for a price increase as we go toward weaning time 2019.

Rounding out the current cattle cycle. As of my mid-September price analysis, I am projecting that the current cattle cycle and its resulting beef price cycle will be completed with year 2019. Figure 4 includes the projected mid-October 2019 fall Feeder Cattle futures prices for the complete price cycle. The 2019 data is projected.


This current cattle cycle and its resulting beef price cycle have fit the more traditional cattle cycles of the 1980s and 1990s, unlike the previous cycle impacted with BSE and ethanol. My attention is now turning toward the next cattle cycle. Stay tuned.

Hughes is a North Dakota State University professor emeritus. He lives in Kuna, Idaho. Reach him at 701-238-9607 or [email protected]

About the Author(s)

Harlan Hughes 2

Harlan Hughes is a North Dakota State University professor emeritus and author of the monthly "Market Advisor" column that appears in BEEF magazine. He also consults and lectures widely, making presentations on ranch business management at various state, regional and national beef industry events. He retired as the NDSU Extension livestock economist in 2000 and now lives in Laramie, WY.

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