Wall Street could get a lift Friday on a statement from Italian Prime Minister Mario Monti. He believes Germany can be persuaded to back so-called euro bonds, which could help resolve the ongoing sovereign debt crisis in Europe.

European developments let the dollar slip lower overnight. Weakness in the dollar is friendly to meat exports, which, in turn, is friendly to livestock prices. That optimism has overnight meat trade pointing mostly higher.

Livestock futures finished with a jumble of results on Thursday as a lift from technical moves by traders mostly offset building fears that meat demand will slow sharply after the spring grilling season.

Markets will be closed Monday for Memorial Day.

Cash fed cattle. USDA reported moderate trading in Nebraska on moderate demand. Compared to last week, Thursday's dressed sales in Eastern Nebraska sold $1 lower at $194 after light trading occurred mid-day at $195. Compared to last week, live sales in western Nebraska sold $1 to $2 lower at $122 to mostly $123.

Iowa saw light to moderate trading with live sales from $122 to $123 and dressed sales earlier in the day at $195.

Trading was inactive in all other areas.

Thursday's sales may mostly complete this week's cash cattle trading following big sales on Wednesday in the Southern Plains at $121.

USDA estimated Thursday's cattle slaughter at 126,000. The 502,000 cattle slaughtered so far this week are down from 505,000 last week and down from 516,000 a year ago.

Wednesday's higher wholesale beef values also boosted the cattle complex. At midday Thursday Choice was up 57 cents and Select was up 7 cents. However, for the day, Choice was only up 19 cents at $195.56. Select slipped 81 cents to $186.84. Load count totaled 195. Failure of the cutouts to hold the early gains could be negative on today's futures.

The latest HedgersEdge packer margin index was $8.35 per head, compared with $4.30 the previous day. This is an estimate of packer returns on cattle slaughtered and processed expressed in the form of an index.

Cattle futures. Live cattle settled a tick higher after trading during the session swung the complex between modest losses and gains. June settled up 7 cents at $117.87. August cattle rose 30 cents to $119.80.

May feeder cattle expired near unchanged at $152.40. August feeders, the new front month, settled up 37 cents at $158.85.

Many commodity markets rose during the early part of the session, providing a lift to livestock futures. The dollar was lower early in the session, providing a dynamic that can make U.S. meat cheaper for foreign buyers. Many outside-market gains faded into the afternoon as investors once again grew more fearful of the ballooning debt crisis in Greece.

Although beef prices continue to reflect the tailwind of a surge in meat buying for the spring grilling season, most notably Memorial Day and Father's Day, traders continue to fear the run will soon peter out. Consumers typically shrug off heavy meals as summer weather heats up. Wholesale beef prices fell through most of June last year before rallying through mid-July.

June cattle are down 2.1% since nearing a two-month high earlier this week. Until then, they had gained nearly 8% over the course of three weeks.

Still, some signs indicate consumers continue to spend money on high-cost beef. Even as traffic across the restaurant industry remains weak, sales at steak-themed restaurants with waiters grew 3.5% in 2011, according to Technomic Inc., a restaurant research and consulting firm. Sales at all restaurants with waiters grew 1.8%.

Cash hogs. Midwest cash-hogs reflect slowing demand.

Weak buying interest from the majority of pork processors on Thursday weighed on prices, despite a few plants still needing animals for slaughter late this week. Prices finished from flat to $1 lower.

In addition, wholesale prices typically soften right after the holiday so meat buyers may wait to see if they can find some bargains before they need to purchase additional product. Limited demand for hogs early next week could weigh on prices today as well as Tuesday, when trade reopens after Memorial Day.

USDA's afternoon reports showed Thursday's:

Iowa-Minnesota hogs fell $1.19 to average $81.59.
Western Corn Belt hogs dipped 55 cents to average $82.33.
Eastern Corn Belt hogs sagged 20 cents to average $80.30.

Price changes are compared to USDA's prior day report for Wednesday.

USDA estimated Thursday's hog slaughter at 415,000. The 1.667 million hogs slaughtered so far this week are up from 1.642 million last week and up from 1.630 million a year ago. The weekend slaughter is projected to be around 10,000 to 12,000 head, down from 71,000 last week, as only one plant is expected to operate Saturday. This week's slaughter expected to be about 2.08 million, or 1.7% above year-ago. All of the large processing plants will be closed Monday.

Weakness in loins and butts more than offset gains in bellies and ribs to trim Thursday's pork cutout 44 cents to $78.20. Load count totaled 79.

Dow-Jones estimated Thursday's packer margin at minus $13.26 per head, compared with minus $13.44 per head Wednesday.

Terminal hogs sold steady to 50 cents lower. Live tops ran $55 to 58.50.

Hog futures. Lean hogs mostly dodged the potential for deep losses after wholesale markets pork pointed a quick slowing in demand.

Front-month June fell for the fourth-straight day, even as other contracts were mostly higher. June contracts settled down 22 cents to $84.20. July hogs gained 47 cents to $86.02.

Outside markets and short covering helped offset building signs that the pork fundamentals are reverting to:

Rapidly-rising supplies
Soft demand
Negative processing margins at slaughterhouses

Lean-hog futures remain on the defensive. Futures have been tumbling in recent days as traders increasingly fear that a surge in pork buying before Memorial Day has come to a quick end. June futures have lost 4% over the last week.

Traders viewed Wednesday's 96-cent cutout retreat to its lowest level since May 8 as a sign buying interest is insufficient to clear pork supplies at current prices. Thursday's 44-cent retreat took the index down $4.48 from a recent spring high of $82.68 hit on May 17.

A quick end to the surge of meat-buying for the spring grilling season could push pork prices even further behind last year, when a surge in exports and tight supplies globally forced U.S. prices to a series of all-time and seasonal records. Current pork prices are 15% lower than the same time last year.

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Tagged: usda, Corn Belt, hog futures, lean hogs, cattle futures

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A lot of good points are getting made here. The number of cow-calf operations is likely to decline. Lack of profitability on some operations will be a contributor. Another force will be competition for resources. Even at current calf prices, cows have a tough time competing with crops for rotational grazing land. The reader who noted farming was never intended to make one large sums of money is right on track, particularly when viewed from the long run. When profits exists, participants, whether they are farmers or ranchers, will bid up the price of the fixed resource base so as to absorb the profits. That’s the force driving land prices higher. It’s helping lift cow and replacement heifer prices. Age of many cow-calf producers is another factor. Cyclical cow herd expansion has yet to start. Historically the cattle cycle has run about 10 years from peak to peak. A cow-calf producer, who is already 70 years of age, may well want to evaluate all of his options, with an eye toward doing something else before the next peak inventory, low price phase of the cycle. Producers who want to be players in the long run will need to find ways to capture an edge. Genetics, production efficiency, using beef fertilizer nutrients in other farm enterprises, capturing additional revenues from non implant cattle are all good tools to do it. The challenge will not get any easier. Being average is not good enough. As something to think about, the United States had 871,000 farms with hogs in 1970. The “average” producer would have ranked 435,500th in that distribution. Each wave in the hog cycle typically lopped off the bottom 5% or 10% in terms of efficiency. By 1983, the number of farms with hogs had dipped to 428,000. The producer, who was in the middle of the distribution in 1970 was likely no longer in hogs in 1983. That producer may well have been my brother who sold the hogs from the dairy-hog farm to focus on dairy about then. No sure fire recipe for success exists. Each producer needs to find ways to use his or her resource base to produce a product which buyers want. Likely as many recipes for success exist as there are successful producers. One thing is clear, producers who want to remain players, need to focus on continuous improvement. J Otte
Posted by Anonymous on April 27 at 6:26 AM

Quality genetics will always yield a profit. No, you may not get rich but farming was never intended to make one large sums of money. What is the lifestyle worth? Go back to how we raised cattle 80 years ago on grass and produce meat for local markets. Recycle the manure and rotate pastures to grow produce and feed grains.
Posted by Anonymous on April 25 at 7:18 AM

We are doing OK with a cow/calf operation raising grassfed beef. Feed prices are half of raising cattle on grain and all the hay we feed fertilizes our pastures and adds organic matter. We are not getting rich but doing better than breaking even with plenty of prime beef to eat. The key is having the proper geetics for grassfed. These cattle have a smaller frame, are good grazers and based on Shorthorn and Belted Galloway/Angus cross genetics. Our customers are willing to pay more for beef without implants or any antibiotics. Right now, calves are selling very well to where selling beef in the future could be limited. All the compost we make also fertilizes our truck crops to sell at the Farmer's Market in town.
Posted by Anonymous on April 20 at 7:42 AM

record high cattle prices offset by record droght and feed costs rent,etc. its always something!!!
Posted by Anonymous on April 16 at 10:21 PM

All excellent discussion! But, I firmly see the end result here, as a whole lot less cow/calf operations in the USA. Just not profitable in comparison to all of the hard efforts/work/thoughts that are put into the operation. A person could easily spend that same amount of time in town at a local fast food operation at minimum wage, and come out money ahead. Good Luck!
Posted by Anonymous on April 13 at 7:57 AM

Cow-calf margins may be dismal. However, making a case that calf prices are too low is more challenging. USDA’s Agricultural Marketing Service Market News Service reported lightweight feeder calves first punched through the $2 per pound milestone when a string of 68 head of reputation, long-weaned, black-hided ranch steer calves weighing 340 pound sold at $200.35 per cwt. at the Pratt, KS Livestock Auction on Dec. 9, 2010. Last week in Texas Medium and Large steer calves weighing 300-350 lbs. averaged $235.08. Not all calves are topping $2. Prices are lower for heavier feeder cattle. And despite some weakness in last week’s feeder cattle markets linked to softer fed cattle prices, feeder cattle prices remain historically high. For comparison, USDA reported 2009 Oklahoma City feeder steers averaged: * $102.98 in 2009 * $109.31 in 2010 * $133.74 in 2011 The current projection is Oklahoma City feeder steers will average in the $150 to $160 range for 2012. Relative to recent history, calves and feeder cattle are pricy. Relative to costs, such prices may be cheap. Unquestionably cow-calf producers face margin compression from the cost side. Pricy feed is one reason for rising costs. Cows face rising competition from crops for land currently in rotational pasture. Most agricultural producers have maximizing return to the fixed resource base as an objective. That resource base can include land, livestock, equipment, water, fences, stock working facilities, labor and management. The livestock manager’s challenge is employ the resources in ways to generate the most bottom line profit. Trade chatter suggests a fair number of farmer-feeders are choosing not to buy feeder cattle, but to sell more grain. Presumably those producers have run the numbers and project that growing and selling corn for grain will generate more return to the farm asset base than growing corn and cutting it for silage to feed cattle. Cow-calf producers need to be inventorying their resources and then evaluating alternative ways they might employ those resources. Nothing can help the manager become a better manager than knowing what those alternatives are and what each one of them implies toward the firm’s expected bottom line.
Posted by Anonymous on March 27 at 6:06 AM

Is there any future in developing/owning a cow/calf operation? Prices are terribly low with no profit at all, only losses. Any ideas?
Posted by Anonymous on March 5 at 6:52 AM

I feel that there is not much profit potential left for beef cow/calf operations. Red numbers, thats all. Lets be honest, farm operation numbers are falling for a reason. To look at the glass half full here wont help when realization sets in, and the glass is all the way empty.
Posted by Anonymous on February 15 at 7:02 AM

Agreed. Cow-calf producers face the same cost-price squeeze as do all livestock proucers and grain users. Over the last five years all grain users have had to make adjustments to higher grain prices. Cattle, hogs and even poultry have responded by trimming production--during extensive losses--in efforts to tighten supplies enough to pull meat and milk prices up to profitabole levels. Cow-calf producers are particularly vulnerable because their biological cycle is longer than for hogs and much longer than for poultry. Plus high grain prices up rents for crop land. That in turn boosts pasture rents. Record prices do seem likely ahead for calves. But record prices won't necessarily equate into profits. That's why focusing on efficiency and working to capture and maintain a margin is so critical all across agriculture. J Otte
Posted by Anonymous on January 10 at 9:08 AM

I would enjoy to see the price of feeder calfs go to $2.00 so that a cow/calf producer could make a little profit and get paid for all of the work and investments and sacrafices endured. The price is always in the news as being so good, and high all time records. But the facts are that it is not even worth producing calfs for that money. It should be a minimum of $2.00 at least. This is a big reason why the US beef herd is so low, and going to stay that way too. Not enough profit, if any.
Posted by Anonymous on January 9 at 9:12 AM

Come to invest in cattles business here in Brazil,we have good pastures at low cost our the feedlot with a cheap labor. e-mail=xerifecountry@hotmail.com
Posted by Anonymous on January 4 at 9:45 AM

yep
Posted by Anonymous on October 12 at 10:52 AM

We have a 50 acre farms located between Ada and Cascade, Michigan-5 miles from the Gerald R. Ford airport. We have been on our land over 50 years; we have not applied pesticides during this time. We have woods, wetlands, water and an abundance of wild life. There were 15 dairy cows here when we purchased the property. We would like to find someone who needs extra room to keep cattle, goats, sheep; also who would possibly be interested in converting raw milk into cheese. Roger Plafkin Plafkin Farms(View on Photobucket.com and Webshots.com) Ada, Michigan 49301 1-616-676-0590 plafkin@juno.com
Posted by Anonymous on October 7 at 5:16 AM

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