Dropping cattle prices could mean less money for Athens farmers

by Hillary Copsey
Senior City Writer

Drastically dropping cattle prices since the Sept. 11 attacks could mean a falling profit margin for Athens County cattle producers.

While most farm markets, including grain and the majority of livestock prices, have fluctuated normally, cattle prices have dropped considerably during the past month, said Roy Lewandowski, Athens County extension agent for agriculture and natural resources. Feeder calf prices have decreased by 10 cents per pound and fed cattle prices have dropped to $69 per 100-weight from $79 per 100-weight in the last month.

Feeder calves are cattle raised by farmers until the animals weigh about 500 pounds. Farmers then sell these calves to other farmers who will continue to feed them until they weigh about 1,000 pounds, and are then sold for slaughter.

Most of Athens farmers raise feeder calves, Lewandowski said. For these farmers, the 10-cent price decrease means $50 lost for every 500-pound calf they sell, said Mike Stroud, Farm Service Agency county executive director for Athens, Hocking and Perry counties.

"You can expect to see money lost in the market, but the average consumer won't see a difference," Lewandowski said.

According to the Ohio Department of Agriculture, there are approximately 560 farms in Athens County and nearly half of those raise cattle. The average farm will raise 20 cows and sell 17 calves each year. If a farm loses $50 on each calf, it could lose nearly $1,000 of its yearly income, Stroud said.

And Stroud said this is an estimate of the loss smaller farms will take. Larger cattle producers could take an even bigger hit.

Scott Pfeiffer, who owns a farm of about 188 head of cattle, said he expects to take about a $4,000 loss because of the falling prices.

"That buys a lot of electric bills and food and all that other good stuff," Pfeiffer said.

Although Pfeiffer raises mostly seed stock – cattle used to inseminate other farmers' cows – he said his prices are affected because all prices are interconnected. A fed cattle producer loses money on the cattle he sells to slaughter, so he cannot pay as much for feeder calves, causing that farmer to lose money. Then the feeder calf producer cannot pay as much for seed stock.

And losses for Athens County farmers mean losses for Athens County as well.

In 1999, Athens County farms had an income of about $7 million, Stroud said. Cattle revenue constituted $4 million of that income, so if prices stay low, the county could lose a substantial amount of revenue.

"I think the jury is still out on how bad this is going to be," Stroud said. "Everything is in flux right now."