Lowering Risk At Times Of High Profits
Written by: Connor English, Farmer & Provincial Territory Manager
MARCH 2025: The most profitable time cattle producers have ever seen.
Over the past year, livestock producers across western Canada have seen tremendous success with the prices of their commodity, which has been much waited on. Moving into the spring of 2025, some producers are in a position of uncertainty as to what crops to grow as annual cropping prices have decreased from past years, and in many regions, lots of producers had a very successful 2024 growing season, resulting in significant amounts of carry-over feed sources.
Carryover feed and high cattle prices?
A few years ago, this was only a pipe dream for most producers who were battling dryer-than-normal conditions across the prairies and subpar to low cattle prices a few years after the 2014/15 highs. This time really resonates with me as that was the first year coming back to the family farm, and trying to find ways to feed our cow herd, let alone as cheap as possible, was something that took up most of my time. These memories from only a few years ago are something I think about daily now. A question I continue to ask myself is, “How do we set ourselves up for success day in and day out regardless of the uncontrollable weather/ market conditions? Developing a year-round grazing system and taking advantage of opportunities when they come have been two things I consistently think about.
A year of above-average profits and more than normal amounts of feed on hand allows most producers to look at self-insuring for an extended time by purchasing appreciating assets. Whether purchasing lower-valued feed or seeding crops that can feed these high-valued animals, we are utilizing the higher amounts of cash flow on a year like this and helping to set ourselves up for success heading into the next growing season.
On our farm, we are looking to add to our already increased stored feed inventory, which allows us to lock in our winter feed costs prior to the 2025 growing season. By doing this we can shift our cropping/pasture grazing rotations to improve our soils’’ resilience and help lower our input costs moving into the future.
By having more stored feed on hand, our goal is to increase the summer grazing impact on our annual cropping acres, which helps increase our animal integration and nutrient cycling process, especially on acres that are hard to graze in the winter months. This also allows for more recovery acres on our perennial pastures which results in more plants having the ability to hit maturity and add to the seed bank moving forward. Our increase in stockpiled pastures will give us the ability to start grazing earlier in the year, moving into 2026, helping reduce our overall feed costs and improving our profitability.
“MAKE HAY WHILE THE SUN SHINES” is a saying I like to think of at this time in the cattle industry.
Record cattle prices
Increased amounts of stored feed across western Canada has made it very reasonably priced
Low cow herd numbers in Canada and the USA projects for stable pricing heading into 2026
The grain market has dipped significantly from the highs of a few years ago, although input costs have gone in the opposite direction.
All signs lead to having another very profitable year in the cattle industry, so if this is the case, why should we not lower some of our risks and build up our feed reserves heading into next winter which is usually not an option with decreased profits. In other words, make hay while the sun shines.