Bred Beef Cow Price Trends Downward

Having cattle that are too large or too small has real consequences.

Bred cow prices, basis the Oklahoma City market, have trended lower this spring for the third year in a row. Mid-aged bred cows (1200-to 1300-pound) during April and May averaged $1082 per head. During the same months of 2017, bred cows of the same description averaged $1194. Spring quarter mid-aged bred cow prices peaked in 2015 at $1875. These prices tend to follow the trend set by feeder cattle prices, but with a bit of a time lag. This spring’s mid-age bred cow price was 6.11 times the 500- to 550-pounds steer price at Oklahoma City. Last year, the ratio was 6.74, and in 2016 the ratio peaked out at 8.06 for the 2004- 2018 interval. The peak in the ratio was one year behind the highest spring quarter feeder steer prices ($285 per cwt., 500- to 550-pound). The ratio hit a low point in the spring of 2010 at 5.66.

Young bred cow prices have been under more pressure than mid-aged cows this spring. Prices have declined by more than $200 from last spring and have averaged a discount of $40 compared to mid-aged bred cows. Over the last 15 years, discounts have occurred only about 20% of the time and $40-$45 is as big as the discounts tend to get. The year of the biggest premiums for young bred cows was 2015 (when feeder cattle prices peaked) at $165.

Young bred cow values in the Northern Plains have been at a premium to the Southern Plains for at least the last six years. Prices for young bred cows in Montana markets have held steady with a year ago this spring after declining $100 from 2016 to 2017. A $400 premium for Montana young bred cows versus the Oklahoma City market this year rivals the euphoric Montana premium of 2015, even though actual prices are $1000 lower than what they were three years ago.