In March 2012, the prices of feeder cattle reached record highs. By mid-July 2012, the severe drought in the Midwest and the Plains caused soybean and corn prices to reach record high prices.
Feeder cattle prices have declined due to the record grain prices and forced liquidation of herds due to drought.
Many producers are contemplating their future in the industry. Should they hang on and purchase feed or exit the industry? What will feeder cattle prices be in 2013? Who makes this decision? The owner? The bank? Will health issues force the dispersal of the herd?
Sometimes producers are forced to sell their herds ASAP when they are faced with life threatening health issues. Does the owner want to stay in business and perhaps lose all his hard earned equity?
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