Beef producers continue to see high prices for their products. Dave Weaber, senior protein analyst for Terrain Ag, said while things are good, don’t forget to work risk management into your marketing plans.

“I think as we’re looking at and talking to producers across the Farm Credit System here over the summer, a lot of them are pleasantly surprised at how high prices are. We had expectations of high prices. They’ve outperformed our expectations. I think we’ve seen a lot of cattle move through video auctions as a way to try to capture that revenue. If you’re still in a marketing plan that’s moving cattle here in late August or September, I’m probably trying to find a way to do at least some risk management to protect those prices.”

It’s important to take advantage of the available tools.

“Forward contracting helps with some of that. There are tools like LRP and futures and options. I always encourage folks to think about their risk management programs as ways to get less long. So, anything you can do there to get less long is part of that protection mechanism. There’s a lot of profit here to capture. We need to start working on doing that.”

Risk management will get more important when producers eventually begin to rebuild their herds.

“As we look at the next 12 to 24 months, that need for protection tends to increase from a cycle standpoint. As we start expansion and we start seeing bigger calf crops, it’s about a 30-month timeframe from when we start that expansion to when calf prices turn over. So, we need to get our heads wrapped around what we’re going to do from a planning standpoint and protect some of that revenue.”