Cattle Risk Management

Lock in your prices with National Farmers Risk Management Tools

Volatility. Uncertainty. Marketing Risks.

Farmers today face an enormous amount of price risk as you market milk, livestock and grain. That means you need the advantages of futures and options.

Today’s agricultural markets shift with seasons and sometimes with the news cycle. Whether you’re raising cattle, producing milk or growing corn, soybeans or wheat, National Farmers offers risk management choices to help you level the global farm market playing field.

Find Freedom to Profit in the Cattle Business

Use The Freedom Hedge to Manage Risk, Achieve Profit

The enormous amount of money in play in the cattle business, means producers serve their profit purposes well when they institute hedges on their operation to manage market volatility, and to protect themselves from the broad uncertainty in today’s world of agriculture.

Manage Price Risk
The Freedom Hedge gives you as a cattle producer the ability to take the price risk you’re facing, and give it to someone else. Price risk causes income variability, and you need to manage risk to grow your cattle operation into the future, so you can provide beef for a world that needs more protein every single year.

With The Freedom Hedge from National Farmers, we’re promoting your progress as a cattle producer. We don’t want your cattle sales prices to surprise you, so the pros using The Freedom Hedge will help. To manage price risk, we coordinate the hedges for you, establishing a base price for your high-quality cattle. But we don’t stop there. You, the producer, are free from futures financing and margin calls. That’s right. That’s The Freedom Hedge.

The ways The Freedom Hedge helps you keep adding up. You’re an excellent producer, so you’re premiums aren’t capped. The better your cattle, the better your money. And you need the ability to deliver at the best beef processor possible, so you get to do that, too. Part of determining your delivery location is by watching basis levels, a major factor in your profitability.

You Get Freedom
Freedom from futures financing
Freedom from margin calls
Freedom from hedge coordination headaches
Freedom from a pre-set basis
Freedom to choose the packer paying the highest premiums
Freedom to protect your cattle enterprise and your future

With The Freedom Hedge, you essentially lock in your margins, so you can continue to feed cattle for years to come. As far as we can see, it’s the most flexible way to hedge cattle in the business. We’re focused on success for you, today’s American cattleman.

The Cattle Hedging Tool Basics
The Freedom Hedge is based on CME live cattle contracts, which are for 40,000 pounds. The number of head the contracts represent, of course, depends on the live market weight of cattle. For cattle marketed at 1,450 pounds, a futures contract would represent about 27 head.

CME Live Cattle Contract Months
Contracts are available for the months of
February April June
August October December

CME live cattle contracts expire the last business day of the contract month.

Your Cattle Operation Knowledge
As we help you with risk management on your cattle operation, we want to truly understand your business picture, so we can leverage all of our experience in your favor. That means our experienced marketing professionals will talk with you about your goals and intent for using The Freedom Hedge to establish cattle sales prices, and your volume participation level.

Your Operation and Plan with The Freedom Hedge
We’ll discuss —

  1. Your breakeven level
  2. Target price goals
  3. Cashflow needs
  4. Volume of cattle sales per month

We Represent You
The Freedom Hedge gives you a way to manage price risk in your cattle operation. It’s a tool to keep in your farm marketing toolbox, and assure you’re getting the best possible situation when it comes to your cattle sales.

Through our decades of experience in the cattle industry and farm marketing, we’ve developed positive relationships with processors that benefit you today. That’s why once a sale is complete, the service isn’t. We assure your payment arrives in a timely manner. And if you have questions about the hedging process or your cattle’s performance, we’ll follow up and look after your best interests.

We give you the whole package from risk management and cattle knowledge to service related to contracts and processors. Contact us today at jrose@nexusag.org or call 814-720-0549.

Reasons to Get Started
* Freedom from futures financing
* Freedom from covering margin calls
* Freedom to stand out in the cattle business

Harness the Pricing Power of Holstein Profit Plus

As a Holstein beef producer, you know your livestock operation provides an important element in the beef supply chain. Holsteins make up 10 percent of the U.S. calf crop. And you want and deserve profit in your cattle operation. We can guide you along the highway to profit through market intelligence and risk management.

If you raise Holstein steers already, you know some things are different than native beef, and you know packers can specialize in one type of animal or the other. That’s another good reason to capitalize on the relationships we at National Farmers have with major processors. We open marketing doors for today’s Holstein beef producer at processors where your cattle are wanted.

With the calf-fed system, the Holstein feeding sector of the beef industry has moved to, carcass weights have become lighter, 1,200 lbs. to 1,400 lbs., and the cuts are similar in size to the rest of the industry. (Univ. of Kentucky) You have what beef eaters want. We tip our hats to producers responsive to consumer desires. Your cattle are valuable.

Holstein Strengths

  1. Hide Value
  2. Marketed for All Cuts of Beef
  3. Predictable Feedlot Performance
  4. Trim Value
  5. Predictable Carcass Value
  6. Impressive Growth in Young Steers
  7. Calf Availability
  8. Consistency of the Breed

Quality Holstein Beef
Packers know you produce quality — and grading evidence shows it.

“The positive relationship found to exist between Prime premium level and Holstein steer prices is supportive of statements by industry stakeholders that Holstein are at least as likely to grade Prime as native steers…. As the market reward for Prime carcasses increases, packers are paying more for Holstein steers.”
Understanding the Market for Holstein Steers
Kenneth H. Burdine, Leigh J. Maynard, A. Lee Meyer
University of Kentucky Department of Agricultural Economics

Marketing Holstein Steers
You can do a great job producing, but you’ve got to do a great job marketing, too, and make all that effort count.

What affects the Holstein market most?
Vertical Integration
Sensitivity to Traditional Market Factors

Basis
Basis on Holstein steers has been more volatile than that of native beef. Holstein basis is strongest in the spring and weakest during the winter — typically. So you may wonder, with greater basis volatility, is it possible to successfully hedge Holstein steers? Yes it is, but the lion’s share of our Holstein cattle finisher customers use packer contracts to get the best possible basis.

Your Marketing Choices
So, how exactly do we help you manage market risk? We offer risk management strategies for Holstein cattle finishers. And we help you understand what to expect out of any contract you use.

  1. Hedges through CME futures Contracts (Link to Freedom Hedge Page)
  2. Processor Forward Contracts
  3. Exchange-Traded Options

We know you choose quality feed, have full vaccination programs, see to proper ventilation in your buildings, and look at every animal, every day to assure the cattle receive the attention they need. You love the Holstein cattle business. And we want to see to it that you receive rewards for it. The kind of rewards you take to the bank.

We work with leading processors and those processors like working with us — and with our member producers. They can rely on a steady supply from all of our members together. And they can count on you for quality. You win for both reasons.

Get Started (These two words on top of Button that pulls up form with operation profile questions, all contact info, appointment request)