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Farm News & Views for the week of February 26, 2024

Cattle producers have received some good news this year. Record prices for all classes of cattle are being paid right now, and it’s likely there will be new record average prices for all of 2024, according to the cattle market experts at CattleFax, an outlook firm that specializes in cattle markets. Their cattle price forecasts for 2024 include that fed steers coming out of feedlots will average $184 per cwt., up $9 from 2023. 800 pound feeder steers that are ready to go into feedlots will average $240/cwt, up $20 from last year. Weaned 550 pound steer calves will average $290/cwt, up $28 from last year, and cull cows will be $16 per hundred weight higher. But CattleFax economists believe that these higher prices may continue for the next three or four years, as producers rebuild cow herds to match beef demand. They also contend that the current cattle cycle will evolve much slower compared to the last cycle, because heifer retention has not started nationwide,and they expect peak cattle prices to occur in 2025-2026. In the meantime, industry profitability will continue to swing in favor of the cow-calf producers, as excess feeding and packing capacity chases a declining supply of feeder cattle and calves. But the downsideis that consumers will pay more for beef during this up-cycle for producers.

The Ogallala aquifer is the largest aquifer in the world, covering 174,000 square miles across Nebraska, Kansas, Oklahoma, Texas and parts of Wyoming, Colorado and New Mexico. Today, the aquifer supports 20% of the nation's wheat, corn, cotton and cattle production, and represents 30% of all water used for irrigation in the United States. But the Ogallala is a closed aquifer, receiving less than an inch of recharge a year. Since development of large-scale irrigated farming in the 1940s, water levels have continued to be drawn down, to the point that in some areas today, farmers are shutting wells down because there isn’t enough water to keep their pumps operating, and the disappearing water is hurting farm production in the Great Plains. Water levels in the stretches of the Ogallala underlying Kansas have dropped an over 28 feet, far worse than the eight-state average of almost 17 feet. However, water levels in the Texas panhandle have dropped 44 feet, and in some areas of northwest New Mexico water levels have declined 19 feet. But rural communities in the Great Plains that also depend on water from the aquifer are also facing uncertain futures, because water for municipal use is no longer a sure thing. Kansas Governor Laura Kelly is warning that some communities are just a generation away from running out of water, but she believes that there is still time to save the aquifer, which in turn will save many of those small communities.

Although most of us just accept cold winter weather because it’s a precursor to warm and sunny summers, cold air has been hard to come by for the U.S. this winter because a very strong El Nino has had a persistent influence on U.S weather patterns for several months. Temperatures this winter have been record breaking in many ways, reaching over 2 degrees Celsius above normal heading into the winter and maintaining the relatively warm temperatures throughout the season. While there were disruptions in warmer temperatures across the U.S. during periods of rain and snow that brought cooler temperatures they only lasted for a couple of days before the warmth returned. But the one long-duration visit from the polar vortex in mid-January that featured below zero temperatures in some parts of the country was the only event that has kept this winter from being the warmest ever in parts of the Northern Plains, and out of the top 10 warmest winter in the Central Plains. For the rest of this winter, predictions point to daytime highs that will be about average, while overnight lows could be a few degrees below normal.

Abraham Lincoln said, “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.”

Bob has been an agricultural educator and farm and ranch management consultant for over 40 years in southwest Colorado. He writes about agricultural issues from his farm near Cortez, and has helped to produce farm reports on KSJD for more than a dozen years.