Steamboat Pilot & Today

Cattle prices across the board are at a six-year high, but beef cattle prices have declined slightly in the last two months and the cost of production is up.

In June, beef cattle prices dipped to the lowest they have been all year at $68.60 per 100 pounds. That market peaked at $72.90 in April, and has been declining ever since, according to the Colorado Agricultural Statistics Service.

However, if the decline stops, the yearly averages for beef cattle could be the best since 1993, when the price peaked at $82.50 in April and averaged $76.70 for the year.

The average beef cattle price for the first six months of this year was $70.30.

The same is true with cow, steer, heifer and calf prices.

The highest price for cows this year was $41.50 in June $1.52 above the average price for the first six months of the year. This year could end with the highest average price since 1994, when it was $46.70.

Steer and heifer prices were the highest in April at $75. In June, they were down to $70. The six-month average for those prices is $72.48, the highest since the $78.50 average in 1993.

Average prices for calves are higher than they have been in 10 years. The sixth-month average is $106.50, with April's price the best at $111 per 100 pounds,

In June the price for calves dropped to a year low of $98.

Routt County's Agricultural Extension Agent, C.J. Mucklow, said this year's general upswing in prices follows a well documented seven-year cycle.

The cycle is related to corn production and supply and demand, he said.

The best prices in the current cycle were recorded six to eight years ago. They hit their low 18 months ago and are now on the rise.

However, costs of production also are rising, and that could cause cattle ranchers' bottom lines to be no better than they were last year.

"The cost of forage itself will be more," Mucklow said.

Because of the drought in Colorado, many ranchers will harvest less hay.

"This drought will have a lot more impact on the bottom line than the increase in fuel prices," said Don Lybecker, a professor of agriculture at Colorado State University.

Though most irrigated hay is doing well in the heat, dry-land yields are expected to be 30 percent less than last year in Routt County.

Ranchers short of hay will either sell less of the crop and keep what they have for themselves, or be forced to buy hay or feed from an outside source, Lybecker said.

The costs will be even higher if ranchers transport the product from a long distance that's where the high price of fuel will come into play, he said.

In addition to transportation costs, increased fuel prices could have an effect on the price of fertilizer.

Lybecker explained that natural gas prices are expected to rise because of the high petroleum cost. The price of nitrogen fertilizers made from natural gas will increase if that happens, he said.

There is some good news, though: the drought did not hit Iowa and Illinois like it did the West.

"It hasn't affected the corn product," Lybecker said.

Yields are excellent in that area, which may cause the price of feed to decline, he said.

July prices for cattle are expected to come out on July 28.

To reach Doug Crowl call 871-4206 or e-mail dcrowl@amigo.net