(upbeat music) - Good morning, Oklahoma.

I'm Kurtis Hair, and welcome to "Sunup."

Replacement heifers can be essential to a cattle operation, but with high cattle prices, will they be economically viable down the road?

"Sunup" host, Lyndall Stout, catches up with Dr. Eric Deves to find out more.

- We're talking now about some of the financial implications when you buy replacement heifers with Dr. Eric Deves, our extension economist.

And Eric, let's dive right in and start with cash flow.

- Yeah, so when we're talking about any long-term investment, one of the first things we're gonna talk about is feasibility.

Is there enough cash to make this happen?

And so with replacement heifers, with the prices we're looking at now, most of our guys are looking at borrowing money to make that happen.

And so they're not going to be what we call self-liquidating, meaning the calves that you're selling off of those replacement heifers, and the cold heifers cows won't generate enough revenue to make your principal and loan payments after you pay for feeding those animals.

So that means cash has to come from somewhere else.

So if we're looking at an operation that already has tight cash flow, purchasing heifers and borrowing the money to do it is only gonna make that situation worse.

They're gonna be more financially stressed.

So you've gotta find cash from other sources to pay for those heifers, pay the loan on 'em, and if cash is already tight, it's not gonna get easier.

It's only gonna get more difficult.

- So another thing to think about too would be market prices and some of the fluctuation.

We talk to Darrell all the time, some of the fluctuations that can happen there, given any number of things going on.

- Right, so the next thing we talk about would be advisability.

So is this, over time, projected to be profitable?

And there's a good chance that that's true, but it's not just that longer term profitability, we also have to look at the added financial risk put on the business when you spend a lot of cash and take on a lot more debt, what that does to the firm's financial ratios, debt to equity, debt to asset, current ratio.

So we're talking about using up a lot of cash reserves from the business and a lot of the credit reserve that that business has.

So if, as you say, we spend the money, a farmer spends the money on that borrows the money, and all of a sudden prices fall.

So if we go back to 2014, 2014 prices were really strong for cattle, and so a lot of guys were buying replacement heifers.

And $4 a pound was not uncommon at that time for replacement heifers.

Prices were solid into 2015.

Then 2016, prices fell back to Earth, and those guys that spent all that money on high price heifers in 2014, were not gonna make money off of those heifers.

So what we're talking about, really, is risk.

You've got a lot of financial risk associated with borrowing money, and if you're already in a tough financial position, your debt to asset, debt to equity, current ratio, et cetera, are in moderate to poor shape.

Buying those heifers is only gonna make things worse and make you increase your exposure to risk from prices, from drought, from disease.

And so the short of it is, keep risk in mind, leave space for risk.

So you might not wanna fill up the pastures just yet.

- So with these things in mind, and granted, this is a very brief overview, this takes some thought, some preparation, some study, possibly some counseling from experts, but with those things in mind, what are some of the options that people can look at in setting this up for their businesses?

- Yeah, so if you decide not to buy as many heifers as what you think your pastures are gonna carry, so you're short stocked, there are a lot of options for that forage.

You can wean calves, put 'em back on stockpiled forage.

You can stockpile that forage to run your stock farther into the fall in winter and put fewer groceries out there.

Hay.

You can lease out pastures.

You can bale pastures, although financially that might be the worst of the options, but there are options available to you.

You can still generate cash off of pastures that you don't put more breeding stock on.

And in many cases, will be lower risk to do that.

- So if there is this urge and there's a lot of conversations happening right now to say, "Hey, you need to buy some replacement heifers, get after it," if there is that urge, what is the first step that you advise people to do to kind of take a step back and map this out?

- Go to your banker.

Talk with your banker about where you're at financially, and then try to figure out where's the cash gonna come from over the next five years to pay that loan off.

And if that can't be positively identified, look for an alternative plan.

- All righty, take a deep breath and plan something else out.

Eric, thanks for your time today, really great information.

(upbeat music) - Welcome to the Mesonet Weather Report, I'm Wes Lee.

Mesonet not only measures realtime weather- (voice cuts out) - Conditions, but it also has some value added tools combining different weather parameters.

The OK-FIRE section of our website is a great example of this.

Three important components of a wildfire are fuel loads, greenness, and weather.

Last Saturday, these components all came together in a bad way for Northwest Oklahoma.

Humidity levels in that area dropped into the tens in the afternoon.

Levels below 20% can be critical.

Westerly wind gusts were also extremely high with several locations clocking winds above 58 miles per hour.

Rain has also been mostly absent in Northwest Oklahoma as you can see from this days from a quarter inch rain map as of Saturday, making fuel loads there extremely flammable.

Drought has delayed the green-up of our warm season plants as seen on this relative greenness map.

This made the Mesonet burning index map show some extreme conditions in the northwest.

The higher the index, the higher the potential flame height.

These conditions coming together made wildfires extremely dangerous.

Two fires in Woodward and Woods counties that day did significant damage before they could be controlled.

Rain fell in most areas of the state midweek, but again, missed the northwest, keeping wildfire conditions at an elevated level for now.

Now, here's Gary focusing on that developing drought in that area.

- Thanks, Wes.

Good morning, everyone.

Well, we got some good rains in the state.

It's Oklahoma though, so when we're dealing with drought, usually the rain tries to stay away from those areas.

That happened this week a little bit.

Let's take the newest Drought Monitor map, see what we're looking at.

Well, unfortunately we see a lot more color on the map than what we had last week.

Much of Northwest Oklahoma, at least the far northwestern corner is now dealing with moderate drought conditions that extends from Roger Mills, Ellis Counties, all the way over to parts of North Central Oklahoma and out into the panhandle with a broader area of that yellow abnormally dry conditions color on the map.

Also, notice across parts of East Central down into South Central Oklahoma, we now have a tongue of moderate drought up in Adair County.

A little bit farther to the west in Cherokee County.

And then, we go down into the south central part of the state with those abnormally dry conditions.

So, these are new areas.

Hopefully some of the rain that fell after Tuesday will erase some of this on the new map, but I'm afraid not much of that's going to occur across Northwest Oklahoma.

At least not what we're looking at so far this week.

A lot of those areas I talked about do show up as a little bit of a weakness in the rainfall maps, at least for the growing season, March 1st through April 10th.

We see across the northwestern corner of the state.

Those blue colors, again, signifying generally less than an inch.

But even over across East Central Oklahoma, we do see that weakness.

Less than four inches in those areas, less than three inches, less than two inches.

So, these weak spots do tend to generate those abnormally dry conditions when it extends over a longer period of time.

Now, if we look at the percent of normal rainfall map for that same timeframe since March 1st, we see those deficits start to show up quite nicely.

Actually not quite so nicely.

Across far Northwest Oklahoma, we see those areas less than 25% of normal over a large portion of that region.

And then over into East Central, Northeast Oklahoma, we see those other areas of deficits.

But really when you look at this map as a whole, there's a lot of orange, a lot of yellow on there, signifying deficits at least since the beginning of the growing season on March 1st.

If we look at the departure from normal rainfall map, these numbers don't look quite so bad.

They're generally an inch to two inches, close to three inches in some areas.

So, those deficits could be eradicated pretty quickly if we get some decent rainfall.

Now, luckily we're just now entering the wettest time of the year, the next two months from mid-April through mid-June.

Easily the wettest two months of the year for most of the state.

Hopefully spring rainfall comes through and we get rid of this drought completely in the next couple of months.

That's it for this time.

We'll see you next time on the "Mesonet Weather Report."

(bright music) - Now, I don't know about y'all, but I can't believe April's already here.

Things are greening up, the crop responding, spring rains have arrived if you're lucky.

And of course, just means that the OSU Agricultural Field Days are right around the corner.

- We're joined now by Dr. Scott Senseman, who leads OSU AG Research efforts here at the university.

And Dr. Senseman, it's spring and it means that the lineup of field days for OSU Agriculture have been announced.

So, kinda tell us what's going on.

- All right, thanks, Linnell.

Thanks for having me on.

Yeah, we have quite a number of field days this year.

We've got seven lined up to allow educational programs to be had at our research stations.

That goes along with anything that OSU Extension has going on.

So, we do the research from the research perspective and then OSU Extension can get that to the producers and the people who need the information.

So, all that's starting off with our field day at the end of this month at Chickasha.

- So, kinda give us an idea of what's gonna go on at Chickasha and then what else is on the calendar for the months ahead.

- Sure.

Well, at Chickasha we'll talk a little bit about wheat and forages this year.

It's usually a pretty much a wheat program, but we're adding some information related to forages.

Just to broaden it out just a little bit.

- And that's the kind of information we typically have our extension and research guys connected with.

We'll have a substantial number of producers in that area very interested in that information.

So the Wheat & Forges Field Day will be April 26th, starting at nine o'clock at Chickasha at our South Central Research Station.

The Lahoma Wheat Field Day will be May 17th, starting at 9:00 a.m. That's always a fairly substantial field day for us.

- For someone who maybe has not been to a field day before, what would you tell them that it's like?

- Well, to me, it's a great opportunity to meet with the people who are actually doing the work.

The information that's coming out of these from the scientists that are doing it, the new discoveries, the practical applications, the best practices of how things can work for them as a producer, That's a great opportunity for the producers and the scientists as well as extension specialists to get together and share information.

We'll also have the opportunity to have some of our administrative staff there, leaders that are here at at OSU, as well as some of the legislators that might be involved with districts that they're connected to to hear a little bit more about what some of the information is that's the latest coming off the press.

- We talk, of course, a lot about livestock and crops on this show and natural resources, the weather, but there is a ton of research going on as we speak on hundreds of topics, right?

- Absolutely.

Sometimes I think of ways for our biochemistry and molecular biology program to be involved in some of the information here.

A lot of the work that goes on in those programs in that department is maybe 10 to 15 years away from some of the work that actually might get transferred into a wheat variety through things like gene editing and genomics, looking at the entire genome of wheat, for instance.

So we've got a lot of opportunities to go really basic with some of our information as well as get to the very applied information that gets to a producer.

- All right, so Field Days, back to that.

Lots of great stuff happening, but these Field Days are no charge to attend, but we do want people to register.

- Right, well, there's no charge for for any of these events, but registration is really great for us so that we can make sure we have enough barbecue for folks and coffee and donuts when they show up.

- Thanks a lot, Dr. Senseman.

Great information.

And if you would like to learn more about the upcoming Field Days and find registration information, just go to SUNUP.OKstate.edu.

(upbeat music) (upbeat music fades) - Good morning, Oklahoma, and welcome to "Cow-Calf Corner."

This week's topic is heat synchronization and artificial insemination.

It's a topic we revisit each spring as we think about spring calving operations, and typically, early April being about the time of the year we're ready to start turning out bulls or starting our AI program.

And so we just talk about the pros and cons of heat synchronization itself and the potential it lends itself to for the sake of doing artificial insemination work.

Artificial insemination permits us to use bulls that are genetically elite and can potentially improve our profit in raising a set of calves relative to our intended marketing endpoint.

And so as opposed to a natural service sire, the opportunity to go to a bull stud and actually pick out a bull and purchase semen that we know has got a little extra genetic merit to add to some of that value of a calf crop is a great thing.

Where we get into those decisions on whether or not it's practical for us to AI and capitalize on that tends to get back to the whole concept of heat synchronization, bringing a cluster or a sizable group of our cows into standing heat at the same time.

And as a result of that, breeding them as a group, whether it's AI or naturally, permits us to look ahead into a calving season where we're gonna have more calves born earlier in the calving season.

And for the sake of our cow herd, we're gonna end up with a cow herd that is more uniform in terms of what stage of gestation length that they're at at a given time.

And so for the sake of managing, vaccinating a set of calves, and adding value to a set of calves, we end up weaning an older, heavier, and more uniform set of calves as a result of more of them born early in that calving season.

For the sake of managing the cow herd, if all cows are pretty much in sync relative to stage of pregnancy, it's easier to manage, both from a nutritional standpoint and a herd vaccination standpoint.

And so we always get back to the reality that a short calving season is a benefit in a cow-calf operation with respect to management and adding value to calves.

So what are some of the things we need to consider?

Big things as we look at a breeding season and heat synchronization, is regardless of what protocol we use to actually synchronize the cows.

- It's gonna require a minimum of two trips through a chute.

We're gonna have to have the manpower and the labor to actually sort on a set of cows, process a set of cows a couple of times.

If we add artificial insemination onto that, that's at least one more time to the chute in order to get AI bred.

Now, heat synchronization permits us to concentrate those efforts into a few days or maybe a few weeks, but at the same time, heat checking is gonna require several hours, morning and night, during that stretch of time when the cows are coming in heat, the cows that are in heat that we're going to be breeding about 12 hours later are gonna have to be caught, contained.

And so we're gonna have to have the facilities and the labor in order to do that as we look at heat synchronization and potential AI.

One of the other things that we get into that we gotta consider, do we have a good AI technician available if we wanna do artificial insemination?

A lot of times we connect the dots on the other part of this management plan.

We get right down to the point that we're ready to AI cows.

We wanna schedule that.

We want to have an AI technician that's available and ready.

And in some cases, depending on the size of your herd, it's not just AIing a handful of cows a given morning or at night, but we may be literally going through dozens of cows, maybe sometimes hundreds of cows.

And the AI process itself takes a special skillset and it's gonna consume some time there.

So those are the basic pros and cons and things to think through.

Again, synchronization of the heat cycle.

Getting more cows bred earlier in the breeding season and more calves born earlier in the calving season is a big benefit.

Consider the pros and cons, see if that works for you.

Consider your labor and facilities resources.

And as I always say, I hope this helps.

And thanks for joining us this week on Cow-Calf Corner.

(gentle music) - We're here with Kim Anderson now to check in on the crop markets.

So Kim, at this point in the year, are the crop prices still trading with a pretty narrow range?

- For all practical purposes, prices are still trading in a relatively narrow range.

Look at wheat prices.

They've been trading from $5 to $5.50 in the last couple weeks.

They've narrowed that up to about a 20 to 25 cent price range.

Just moving sideways.

Look at corn.

Corn was trading in a $4.40 to $4.50 range.

It widened that out a couple weeks ago to $4.35 to $4.55, but that's still a narrow range and it's sideways prices just like wheat.

On soybeans, they're really in a narrow range for beans.

I mean $11 to $11.25 and for all it's down, bean prices are down now near round that $11, but still in that narrow range.

The one thing we know that's gonna happen, we just don't know when it's gonna happen, but something's gonna happen to get these prices moving again.

- So what's happening in the market right now that could cause these prices to change?

- Well, when the market's right, watching right now is they've got the planted acre numbers.

They came out a couple weeks ago.

They're watching crop conditions, our wheat crop's in significantly better condition than it was this time last year.

Slightly lower acres, they're watching the weather.

You look at the long-term weather, the 90 day forecast, it's for about average moisture and above average temperatures.

So the market's concerned about that.

There's some talk about it in northwestern Oklahoma and Western Kansas about it getting dry and the wheat under stress.

One report said that we were switching from El Nino to El Nina, switching from wet to dry.

And some people are concerned about that.

There's always Russia.

Two reports this week, just under 3.4 billion and just under 3.5 billion bushels, a lot of wheat expected to be produced by Russia and put on the market.

- So when should farmers think about selling this year's wheat crop?

- It's obvious.

You look at average wheat prices from 2009 through 2023, calculate your monthly average price, and then your average price for the June through August time period.

You look at this chart, it's obvious that you should sell your wheat.

Unless you can predict prices, you should sell your wheat in the June, July, and August time period.

I'd look at from the average June, July, August period.

It's a 20 cent drop to the average September price, and it goes down from there the rest of the year.

These prices are for harvest prices for June, July, and August on out.

We've got five cents per month storage in them.

Our average was $5.83, and it's that throughout the June, July, and August.

That's when to pull the trigger.

- So at this point, wheat prices a are a little lower than last year.

What do you expect to see in the coming months?

- Well, I expect prices maybe go up a little bit.

If you look at the harvest price right now, around $5.40.

If you look at that June, July, and August time period, on average, you've got a plus or minus 90 cents move during that three month period.

In other words, if you've got $5.40 expected price, your low price is $4.50, and your high price is $6.30, and you would expect a dollar and 90 cent move.

- In that June, July and August time period.

So there's a a lot of movement there.

So you need to stagger it up over time during that period.

- All right, well thanks for the updates, Kim.

We'll see you next week.

(cheerful country music) - Do y'all have any unwanted pesticides that you need to get rid of?

If so, OSU extension will be partnering with the Oklahoma Department of Agricultural Food and Forestry for collection and disposal of these chemicals.

The first disposal date will be April 22nd at the Jackson County Expo Center in Altus.

And just a few days later on the 24th, you can head over to the Heart of Oklahoma Expo Center in Shawnee.

For more information about these events, just go to sunup.OKstate.edu.

Finally, today, Sunup's intern Jamie Driscoll takes us to the city to see what the OKC Farm Show has to offer.

- We're here at the Oklahoma City Farm Show, which is a three day farm show event that happens each year in the spring.

In fact, this is the 20th year of this event.

And as OSU extension we're here just sharing extension resources and information.

So we've got a booth here full of our fact sheets.

We're doing things like demonstrating this Hereford Dystocia simulator and just sharing general resources.

We also have some seminars that we're teaching.

So we've got two seminars today and tomorrow that we're teaching on a variety of topics, sprayer calibration, egg production in your backyard, and also honeybees are some of the topics that we'll be teaching on.

- So this is our spray kit that we use an extension when we're traveling, doing maybe presentation on nozzles and proper nozzle selection.

(liquid sprays) And we can turn it on here and we can see this nozzle applying water at a given rate.

A lot of nozzles are set, either applied pesticides, say at 0.4 gallons per minute, which this nozzle is.

We can also look at droplet sizes.

You know, if we change pressure, lower pressure and we change the droplet size to larger, we can talk about controlling drift.

- So what we're gonna do now, I want you two to- - And then for us at OSU extension.

It's a great opportunity to have some interface with our community.

So we've got extension educators from across the state who are here staffing this booth, and we are interacting with people, telling 'em about the services and the resources that we have as OSU extension.

(cheerful country music) - And that about wraps it up for us today.

Now remember, if you saw something on the show that you like, you can always go to our website@sunup.okstate.edu or visit us on social media and YouTube.

I'm Curtis Hare, and remember, Oklahoma Agriculture starts at Sunup.

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