Why pasture is always best

In another reminder of why pasture is always best, futures contracts and transaction prices for feed in the USA have jumped again. According to the CME group;

"Corn futures jumped to record highs on Friday and ticked a few cents higher today over concerns about poor crop conditions. The MAR, MAY and JUL12 contracts settled at an average of $7.85/bushel this afternoon, up 35¢ from a week ago. Soybean futures for the upcoming year also have broken through to new highs after trading between $13.00 and $14.00/bushel for most of 2011. Hay prices are up significantly as well: in California’s Central Valley premium alfalfa is averaging more than $300/ton delivered, according to USDA."

The prices reflect the competition for supply between food for humans, food for livestock and material for bio fuel manufacture and ramp up input costs for dairy farmers. In many cases these costs are 80 - 120% higher than where they sat five years ago.

By comparison, with a pasture based system we can suffer inflation on fertiliser, grazing and the limited amount of bought in feed, but in an indirect way increasing feed costs offshore increase the rate of return on our pasture based farms. Let's not forget.