Cattle markets are seeing record highs. This is good news for South Dakota’s more than 16,000 cattle producers. But this upswing is met with cautious optimism by many.
To understand what is driving the market and more, SDPB’s Lura Roti visits with cattle producers from Forestburg, Gregory and Kimball.
Auctioneer Eric Nowotny markets a group of weigh-up cows at Kimball Livestock Exchange during the June 13 auction.
His employer, co-owner of the Livestock Exchange Wade Christensen explained the atmosphere created by markets that are up more than $400-a-head over this time last year.
“It’s been fun having sales. The consignors have been very pleased with what they’re going home with. I mean, they’re just not used to ever having that much money. We’re handling way more money than ever handled before in history too,” said Wade Christensen.
The last time cattle producers saw prices almost this good was 2014.
“It’s at an all time high. The highest in history. We’re about $20 higher than the highest level in 2014. So, it’s pretty exciting. It’s also pretty scary to think how good it is,” said Wade Christensen.
“They’re pretty amazing right at the moment,” Charlie Zoss said.
Charlie Zoss is a third generation Forestburg cattle producer who recently sold yearling steers at Kimball Livestock Exchange for $500 per head over 2022. And this profit increase was on steers that were 25 pounds lighter.
“It feels a little top heavy to me right now though. It always does when it gets this high though. You never know when the next low swing is coming…so you just worry about when they’re gonna pull the rug out from under you,” Charlie Zoss said.
Although Brett Kenzy doesn’t have any cattle ready to market at the moment, the Gregory cattle producer and National President of R-CALF has visited with plenty of cattle producers who have.
“I was at Fort Pierre last week at the sale and it was a lot of fun. You know, there’s a lot of smiling faces and I think a lot of people are gonna get their balance sheets healed up some. You know from the last few years. So, that’s pretty great, we need to take a moment and enjoy it and be thankful. I guess for me, we also need to look forward. We’re gonna sell cattle at good prices, hopefully, but we have to replace them, so we’ve gotta be mindful. We can’t let our guard down in these good times,” Kenzy said.
In recent years, many cattle producers have sold at break-even or at a loss more times than they have sold at profits.
And the reason Kenzy, Zoss and Christensen express cautious optimism when they talk about current cattle markets are the similarities to the 2014 markets.
In 2014, low cattle numbers nationwide drove the rally. Wade Christensen said the same is true today.
“The demand for beef is excellent. The biggest thing is, we’re so short of cattle right now in the United States. I mean, we’re at an all-time low on cow numbers, so the numbers aren’t there,” Christensen said.
According to National Agriculture Statistics data, nationwide cattle numbers are down 3 percent over 2022.
And because it takes a significant amount of time to build herd numbers – each beef animal harvested takes about two to three years to raise – back in 2014 cattle producers thought the markets would stick around for a while. But that is not what happened.
Again Brett Kenzy.
“When the market went in 2015, it went all at once. It caught a lot of us flat-footed because you know, we had many of us bought into the idea that this was gonna be the new normal. You know, those were just the new prices that cattle producers were gonna get,” Kenzy said.
Brett Kenzy raises cattle with his brother, George. In 2015 the men lost more than $600 per head. Brett Kenzy blames beef imports for the sudden drop in markets eight years ago.
It was the 2015 market dive that motivated him to become an advocate for cattle producers. In his role with R-CALF he advocates for mandatory country of origin labeling and other federal policies to enforce transparency and anti-trust laws.
“I don’t necessarily wanna ban imports from countries that do have the same standards as us, but we have to differentiate to allow ourselves to compete. Otherwise, that’s invisible production that can be brought in pretty suddenly. That will rock our markets substantially,” Kenzy said.
Brett Kenzy and his brother will have yearling steers ready to sell this fall. He said he is eager to take advantage of the current markets. But will remain diligent in his advocacy efforts – hopeful that this time the good prices will stick around.
