Montana ranchers see record cattle prices

The drive to the local feedlot from Scott Blain’s Joliet farm is 6.4 miles, but getting there takes the better part of the year. Blain rolled into Oswald Feedlot on Wednesday with calves in tow and maybe a few gray hairs poking from beneath his Case baseball cap after early worries of devastating drought and $200-a-ton hay. In May, the 34-year-old rancher considered partially liquidating his stock because he just wasn’t sure he could afford to feed them all. But the rain picked up, pastures filled with grass and Blain delivered his Minnesota-bound calves to the feedlot with his wife, Ellen and 2 1/2-year-old son Weston. “We got rain pretty much just in time,” Blain said. “The way it was looking in May, there was no hay, no pasture. We were getting ready to sell, starting with the oldest ones, the ones that were going to be sold this fall anyway.” Now cattle prices are higher than most ranchers can remember, with premium calves selling for more than $2 a pound, which has made cow-calf operations like Blain’s the success story of the year for Montana agriculture. Ranchers were teetering on the edge of economic disaster, but are now seeing strong payouts and lower than expected feed prices. Gross receipts for Montana cattle should be well over $1 billion for the fourth year in a row, with everyone from local feed dealers to shopping malls benefiting as the money makes it to Main Street. “It’s as good as we’ve ever had,” Blain said. The number of cattle in the United States is at a 60-year low and has been for more than two years. That small supply, coupled with rising foreign demand during the roughest part of the recession, pushed prices upward beginning in late 2009. By 2010, cattle prices were at record highs, and with the exception of a few dips, have steadily increased. Foreign buyers kept the U.S. beef economy in the black, as recession-minded American consumers passed on beef and went for lower-priced chicken and pork. From 2010 to 2011, U.S. beef exports, valued at $5.4 billion, increased 33 percent, according to the U.S. Meat Export Federation. By 2012, exports had added $216.73 to the per-head value of U.S. cattle. Export demand has softened some, but the U.S. appetite for beef has steadily increased as the country slowly crawls out of the recession. In addition, cattle numbers declined in 2011 and 2012 as ranchers in drought-stricken parts of the United States liquidated. Though 2013 isn’t done, there’s reason to believe it will be the third straight year of drought-related sell-offs...more