Dear Mastermind Member,

Last week I wrote about "overpriced" and "underpriced" animals in the current market with some of the lighter stock being "overpriced" compared to the heavier stock.

This week we'll look at grass as being "overpriced" or "underpriced".
It is hard to imagine there would ever be a time that grass is not valuable. In fact there is never a time that it isn't valuable, rather, it could just be "underpriced".

At the school I spoke breifly about the difference between "value" and "valuable" and how this affects our psychology. A Mercedes Benz is considered to be "valuable" compared to a Commodore but a Commodore could be considered good "value".(subject to personal bias of course)

We could then find it an emotional struggle to sell a new Mercedies and buy a Commodore.

Emotionally we struggle with selling something that is valuable unless we are desperate.

But this is the paradigm shift that we have to have. Too often we hold on to livestock, selling valuable grass to them, because we feel the stock are too valuable to sell. Or we won't sell and buy back because we are we can't bear to part with the stock we think are more "valuable".

By using the spreadsheets it is easy to see which livestock are "overpriced" or "underpriced". They either are or they're not.

With grass it isn't that simple because it is constantly moving on the scale from "value" to "valuable".

For example when it rains and there is plenty of grass about, then grass is good "value", because everyone has some and they are selling it as fast as they can to livestock they are buying. (which more often than not are "overpriced")

Alternatively grass is then extremely "valuable" when it is dry and not many people have any. This is when we should be selling it to "underpriced" livestock or other peoples stock AT A PROFIT.

We struggle with the issue of better production and growth rates when the grass is green or growing and thus often forget that there actually may not be a profit in selling it to livestock at that point.

This is not to say there aren't good profits when the grass is growing, just be aware how everone else is valuing that grass. If it is "underpriced" or "value" then maybe you should depart from the crowd and consider it may well be worth buying some to sell later when it becomes "overpriced" or "valuable".

 
Cheers Rod