Backgrounders

[High Plains]

This is all very interesting and possibly some of the most valuable perspetive we could share in this forum.

A year ago I bought into a pen of heifer calves with a guy that had purchased them from west-central Montana. I paid him $25 per head for the pleasure of buying in on the deal after the fact, and the market had gone up some. At the time, things looked like a home run. The heifers were started in a backgrounding yard and sent to corn stalks and triticale/rye pivots until being placed on feed in June. Corn went through the roof this summer and that stung me on the finishing cost since we weren't smart enough to strike when the iron was hot (low corn in May). The last draft of those heifers is now filet mignon and hamburger. We had one teen pregnancy, with resulting healthy pair, that we've yet to sell. Right now I've got 7.5% return on my equity, not including the pair. Of course, I've yet to pay taxes on that. I have flat broken even on Wall Street for the past two years and I'm thinking I need to own more cattle! If I'd have been wise enough to buy a mini-corn contract in May (and sold almost anytime I wanted to after that) I would have made even more. I didn't have a commodity broker at that time and I wasn't heeding my own advice about risk management. :roll:

Bottom line, I made some money off of someone's high-priced heifers. No doubt he was happy with his check at the time also. I felt good to make what I did and hope I don't mess up and make a bad deal next time. :dunce:

On the cow-calf side I've had a tougher year with just a few unfortunate turns of mother nature. The percentages on losses can eat you alive when you're a small-timer!

 

[ANGUS327]

This is all very interesting and possibly some of the most valuable perspetive we could share in this forum.

A year ago I bought into a pen of heifer calves with a guy that had purchased them from west-central Montana. I paid him $25 per head for the pleasure of buying in on the deal after the fact, and the market had gone up some. At the time, things looked like a home run. The heifers were started in a backgrounding yard and sent to corn stalks and triticale/rye pivots until being placed on feed in June. Corn went through the roof this summer and that stung me on the finishing cost since we weren't smart enough to strike when the iron was hot (low corn in May). The last draft of those heifers is now filet mignon and hamburger. We had one teen pregnancy, with resulting healthy pair, that we've yet to sell. Right now I've got 7.5% return on my equity, not including the pair. Of course, I've yet to pay taxes on that. I have flat broken even on Wall Street for the past two years and I'm thinking I need to own more cattle! If I'd have been wise enough to buy a mini-corn contract in May (and sold almost anytime I wanted to after that) I would have made even more. I didn't have a commodity broker at that time and I wasn't heeding my own advice about risk management. :roll:

Bottom line, I made some money off of someone's high-priced heifers. No doubt he was happy with his check at the time also. I felt good to make what I did and hope I don't mess up and make a bad deal next time. :dunce:

On the cow-calf side I've had a tougher year with just a few unfortunate turns of mother nature. The percentages on losses can eat you alive when you're a small-timer!

7.5 % heeding your own advice is not a bad return much better than the -49 % I got from my broker when I bought some shares in a uranium mine a few years ago.

One of the best deals I made in the cattle business was this spring. I bought 25 1st calf pairs for $2200. each including delivery on June 6 I sold the steer calves of which there were 15 on Oct 19 ave $880 each and sold the mother's last week privately for $1900 and the new buyer will pick them up from our pasture.

 

[4Diamond]

I like to buy bulls and unweaned calves which in most cases is buying and capitalizing on another's mistakes. Keep the stories coming, this is interesting.

 

[Hereford76]

ya this is interesting stuff.

i think one of the better buys i ever made was late 90's. i used to get this "Green Paper" that covered i think south dakota, nebraska, and i don't remember where else. anyhow there was an ad that started in a june issue on a potload of first calf black pairs with black calves at side for sale due to drought for $1200 per pair at highmore sd. july came along and he still had them for sale only 1100 per pair. then aug came and he had them still listed for 1000/pair. i phoned him and the guy still had them so i offered 900 and we settled on 960/pair. went down with neighbor and his truck and loaded them - remember driving thru sturgis when that whole deal was going on, right down mainstreet in a truck and pot - interesting sights to say the least. anyhow we couldn't fit everything on the truck so i had to go back for 8 pair with my trailer. got them home banded the bull calves and sold them steers for over 800/hd. sold the top end of the heifer calves as replacements to a guy east of us about 50 miles for 850 and just dumped the rest of the heifers... don't remember what they brought per head. the girls where already bred back before i got them home, and sold 35 of them as bred three's the next march in our sale for 1250. the strangest thing about the whole deal was those guys where chopping corn about neck hi dryland corn, there was water in lots of the low spots but it was still a drought. looked like heaven to me.

 

[Faster horses]

We knew an older rancher in Wyoming who would go to the sale and buy the bulls that came through along with odds and ends. He'd keep the bulls and feed them and fatten them up then sell them. The odds and ends, he might run through his chute, trim them up so they looked better and often times he'd take them right back to the sale the next week or the week after that.
He always made money!!

The best cow deal we ever got was 1978, we bought some nice 3-6 year Hereford cows for $270 private treaty. We called the man that got us started in the ranching business to see what advice he had to give. He said, "if those cows don't make you money, nothing will." So we bought 'em and they worked our good.

 

[scout]

I think backgrounding is a must these days if anything a buyer who buys a healthy set of calves is a hell of alot more likely to come back for them the following year and if you get that good reputation It could be the difference between black and red ink on a tough year. we ve had some really good prices the last few years . the old saying the solution for high prices is high prices and the solution for low prices is low prices. I hope the good years keep coming but inevitably the tough ones will soon be here. at a sale thursday 511 # steers weaned 60 days and 2 rds 1.65 600# hfrs non weaned no shots 1.25 that is the difference in backgrounding here.

 

[Big Muddy rancher]

I think backgrounding is a must these days if anything a buyer who buys a healthy set of calves is a hell of alot more likely to come back for them the following year and if you get that good reputation It could be the difference between black and red ink on a tough year. we ve had some really good prices the last few years . the old saying the solution for high prices is high prices and the solution for low prices is low prices. I hope the good years keep coming but inevitably the tough ones will soon be here. at a sale thursday 511 # steers weaned 60 days and 2 rds 1.65 600# hfrs non weaned no shots 1.25 that is the difference in backgrounding here.

511lb steers and 600lb Hfrs :? apples to oranges

 

[Silver]

I think backgrounding is a must these days if anything a buyer who buys a healthy set of calves is a hell of alot more likely to come back for them the following year and if you get that good reputation It could be the difference between black and red ink on a tough year. we ve had some really good prices the last few years . the old saying the solution for high prices is high prices and the solution for low prices is low prices. I hope the good years keep coming but inevitably the tough ones will soon be here. at a sale thursday 511 # steers weaned 60 days and 2 rds 1.65 600# hfrs non weaned no shots 1.25 that is the difference in backgrounding here.

511lb steers and 600lb Hfrs :? apples to oranges

Yes. And I think the subject was backgrounding, not preconditioning. That's a whole other subject we could argue about :lol:

 

[3 M L & C]

I think backgrounding is a must these days if anything a buyer who buys a healthy set of calves is a hell of alot more likely to come back for them the following year and if you get that good reputation It could be the difference between black and red ink on a tough year. we ve had some really good prices the last few years . the old saying the solution for high prices is high prices and the solution for low prices is low prices. I hope the good years keep coming but inevitably the tough ones will soon be here. at a sale thursday 511 # steers weaned 60 days and 2 rds 1.65 600# hfrs non weaned no shots 1.25 that is the difference in backgrounding here.

Buyers that buy unweaned calves know what they are buying. You don't get a bad reputation because of how they have to treat the calves when they get them home. You can't help if a weather related problem becomes bad for those calves. That's why unweaned are cheaper. Also agree with others about compairing the steers to heifers. Realistictly a person could find any price in a sale report to make you feel good about whatever decision you make with your calves. But unless you know the quality of the animals and saw them at the sale the price others cattle bring dosn't mean squat.

 

[Dreamin Big]

I like to buy bulls and unweaned calves which in most cases is buying and capitalizing on another's mistakes. Keep the stories coming, this is interesting.[/quote



I do the same thing here. I have always made money so far. My dad used to always tell me if you like to gamble be a farmer.