High feed prices, poor weather lead to the perfect wreck
By Tim Kalinowski
Hay, hay, hay, what to do about hay? As Southern Alberta comes off its second consecutive year of drought that question is not just an abstract thinking exercise for many cattle farmers in the region, it’s pretty much their sole pre-occupation, says Ted Nibourg, Farm Business Management Specialist with the Ag Info Centre.
“We are seeing a lot of cows going to market,” he states. “Certainly, we have had reports of anywhere from 25 to 30 per cent cull rate, which is a high cull rate. Our average is about 10 per cent.”“The real big difference this year is even thought we have a high cull rate, those cull cows are not being replaced,” Nibourg continues.
“Our heifer replacement, according to the StatsCanada July 1 numbers for example, was down five per cent. I dare say if we were going to run those numbers again at this time of year, we would probably see that rate climb up to 25 per cent.
“Guys don’t have feed, the high cost of feed and the pastures ran out early. A lot of guys had to start feeding early; so it was a perfect storm for causing a wreck in the cow/calve business.”
Nibourg says feed prices are just starting to come down with the quantity of feed grain coming into the market after a terrible fall harvest season, but it’s already too late for most to make a difference in their herd decisions.
Backgrounding calves, for example, likely won’t be an option many are considering this year, he says.
“I don’t see cheap feed happening this fall; so a lot of those calves that are out there are going to go directly to the feedlot.”
The biggest impact the increased quantity of feed will be a reduction in prices, which will help a little in terms of feeding whatever is left of the remaining herd through the winter, says Nibourg.
But it is not a happy circumstance for those hoping to sell their feed or get a crop off for a decent price this year.
“Now that the crops are coming off, there is a lot of straw out there; so producers are looking at some barley-grain straw rations, which really reduces the cost quite a bit less.
“The numbers I ran through the other day a guy could, on a barley-straw ration, feed his cows for about $2 per day; whereas if he were looking at $0.12 hay, he would be looking at $4 per day for keeping a cow— about half the price. So we are going to see a lot of that going forward.”
Nibourg is also fielding a lot of calls, he admits, from farmers asking about feeding options other than buying bales or using straw rations.
“We are seeing that softening trend for feed price,” Nibourg says. “And that’s softening up some of the hay prices as well too because we have been getting quite a few calls where people have just given up on taking their crops off as grain. And they either decided to let the cattle graze, or they took it off as green feed.”
While the picture for winter feed in southern Alberta is a challenging one, says Nibourg, it is not the case for the entire province; not that this fact will help Alberta producers much.
“Calgary south has been the hardest hit with the shortages and the high hay prices, but we get north around the Peace country they experienced some good hay production this year. It’s reasonable prices in that neck of the woods, but they time they get it down to even central Alberta the prices got escalated.
“We are talking about $35 a bale is what guys are charging to take it from, say, Athabasca grasslands down to Camrose. The price of transportation just kills it, and beyond a certain point it just don’t pay.”
One trend sticks out as a possible silver lining in this year’s bleak overall picture in southern Alberta’s cattle market— representing one small shard of hope for next year, says Nibourg.
“Our calf prices this fall, from what I am seeing right now, are fairly stable and they are positive,” he says. “But that remains to be seen whether that will continue.”