Two-stepping our way out of a drought?

By Nathan Smith

It’s two steps forward and one step back. Or is it one step forward and two steps back?

I was never much of a dancer, but with rain falling in some parts of Texas, cattlemen have to feel like they are in some kind of twisted two-step with Mother Nature.

Right now there are more questions than answers.

 First step forward: Rain is falling in parts of the state. But will it last? Will we see another summer like 2011? The U.S. Drought Monitor still has much of Texas underneath a “severe drought” category. Some climatologists say we are only at the front end of a drought and the rain could be short-lived.

Second step forward: Cattle prices are still rising, but when will the price outrun demand? When that happens, how far will the market drop? Cattle were literally bursting out of sale barn pens last summer. Now most auctions wrap up in a few hours.

 One step back: Texas saw more than 600,000 head of cattle leave the state for slaughter plants or other states with more grazing. Experts say those cattle are gone for good. Countries like Japan and China want our beef. That’s a good thing, but where will it come from? The national herd—just like the one in Texas—is shrinking.

Spinning in circles: Feed and fertilizer prices are following higher cattle prices, and that means more risk with the same profit. Hay is still expensive. Will fuel hit $5/ gallon this year?

Dance with the one that brought you: So the question is, why do they do it?

Most ranchers in the state grew up on the back of a horse, feeding hay in the winter, caring for calves in the summer. They were taught by their fathers and grandfathers. It’s nothing unusual to hear of sixth or seventh generation ranchers in Texas. It’s in their blood.

The truth is, there has always been and always will be risk in production agriculture. Ranchers know it and accept it as part of life.

Every year brings a new challenge. Cattlemen and women weather uncertain markets, economic recession and drought because they want to. They don’t want it any other way. 

They grow something that has always been, and always will be in style–beef.

For many, there’s room on the floor and the music is right. Texas cattle ranchers will keep in step and see what 2012 holds in store.

Nathan Smith

2 Responses to “Two-stepping our way out of a drought?”

  1. Jerry & Debbie Staton says:

    Due to the draught, have you heard of smaller ranchers changing their income tax status from a business to a hobby? In particular if they have less than 10 head of cattle? Or should the small rancher maintain their business status? Thanks and enjoyed your article.

    • Mike Barnett says:

      I haven’t heard that Jerry. This is something you owuld need to discuss with an accountant. Thanks for reading!

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