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Drought interrupts South Dakota's fall cattle run

But this year's drought has numbers and marketing patterns looking different than a typical year. Many producers were forced to sell some calves early or liquidate cows due to the lack of grass and water. The increased culling made for a busy summer for livestock auction markets.

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The drought has changed normal marketing patterns at South Dakota livestock barns, including Hub City Livestock in Aberdeen, South Dakota. Michelle Rook / Agweek

The fall cattle run is underway and hundreds of thousands of calves and yearlings will be sold at the region’s auction barns. But this year's drought has numbers and marketing patterns looking different than a typical year. Many producers were forced to sell some calves early or liquidate cows due to the lack of grass and water. The increased culling made for a busy summer for livestock auction markets.

“We didn’t sell a lot of pairs," said Kent Fjeldheim, with Herreid Livestock at Herreid, South Dakota. "A lot of people split cows and kept the calves, sold the cows. I would say we probably sold 30, 35,000 head of yearlings in June, July and August.”

Steve Hellwig, co-owner of Hub City Livestock in Aberdeen, said his barn saw the same trend at their sale barn, and that’s changing the normal marketing pattern this fall.

“It did get interrupted. We moved a lot of them early, had a little break in the middle and now we’re back at it. But no doubt, make no mistake the yearlings are about done,” he said.

That liquidation would have continued if it hadn’t been for rains that started in August and came just in time to green up the pastures.

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“You know, we had a lot of people here talking about selling calves and cows in September, right, and we haven’t sold any yet, so this rain has made a huge difference,” Fjeldheim said.

Hellwig said the rains were a lifesaver for many cattle operations in central and western South Dakota.

“We were probably a week or 10 days away from complete disaster in August. The list of pairs was unreal. And then it started to rain," he said. "We got by a week and then it rained some more and surprisingly the grass is as good now as it’s been all year.”

The early sales have tightened fall supplies and also led to a stronger market for calves and especially yearlings.

”A lot of these yearlings are bringing $1,400, $1,500. I mean, that’s nothing to sneeze at. I mean, more would be better, but the next guy buying them, you know, he seems to come up a little short all the time,” Fjeldheim said.

And he believes there is a marketing hole coming.

“Well, I do think, you know, there’d be some opportunity coming up," he said. "There are going to be a lot of cattle done here in December and January, you know, where most of these cattle would be done in February and March.”

Hellwig is also optimistic about the outlook for the cattle market in 2022 and beyond.

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“I don’t think this yearling deal is going to get any cheaper," he said. "I think the calves are going to stay really strong.”

And he believes the yearlings that were sold early may result in a marketing opportunity at the end of the first quarter of 2022.

“I still believe there will be a little hole here March and April. There’s no question the calves are about 10% lighter coming off the cow because of the drought. The yearlings will be cleaned up a little earlier,” he said.

In fact, he’s even more optimistic about the market longer term.

“We liquidated a lot of cows, North Dakota we sold a lot of pairs this summer, we sold weigh-ups all summer long. I just, I think we’re a year away from it really getting good,” he said.

Cattle producers are now looking ahead at 2022 with hope that the drought conditions will continue to ease. The late summer and fall rains have allowed them to put herds back on pasture, which have greened up, and they’re also grazing small grain crops that failed. And Fjeldheim is optimistic producers can secure enough feed to sustain their herds for the winter.

“I think a lot of people got enough scratched together to probably even background some calves or at least keep their own calves till they normally do,” he said.

Water is the bigger concern for cattle producers heading into winter, according to Hellwig.

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“The problem is going to be these big stock dams and these big holes. They’re low, and we’re going to need Old Man Winter to fill them, and that’s what it’s going to take,” he said.

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