Online Auctions Rigged?

[Still Tryin]

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[Brian04]

im sure its only cuz they start it low but have a minimum price they want for the calf its no diff at live auctions the seller wants 2000 for there calf the auctioneer will get the bid to 2000 and if it doesnt get to that then take him home

 

[iowabeef]

I feel these are no more dishonest than private treaty phone sales.  Bottom line, you have to trust who you are buying from and pay what you think a calf is worth. No more....You have to do your homework.

 

[iowabeef]

I would also say that from what I have seen prices are higher than usual for the online sales this year. 

 

[Brian04]

cattle prices are up this fall tho

 

[farmin female]

cattle prices are up this fall tho

Not a valid comparison.  You're talking 2 completely different markets.  It's the old apples vs. oranges thing.  I suppose cattle prices could impact the low end show steer market, but that is it.

 

[iowabeef]

Have to agree with Farmin' Female....the show cattle market is so far removed from the regular cattle market. I thought with the economy in the shape it is, things might pull back a little...guess I was wrong.lol

 

[nkotb]

While I would agree that the markets are two very different markets, I would also say that if you can get $900 at the sale barn for a calf instead of $600, logic says you should be getting a little more for your show calf.  Also, the cost to produce that calf is up tremendously this year as opposed to last.  I talked to a gentleman that normally starts his prospects at $800 and $1200, but thought this year he would have to start at $1000 and $1500.  Also, while the economy is down, farm prices are at record highs, and most showing are involved with agriculture somehow, thus probably not doing as bad as the rest in the economy.

 

[twistedhshowstock]

While yes we are talking about 2 different markets, its not as different or far removed from each other as some want to say.  At the end of the day, a calf is still a calf.  Hypothetically speaking here, these arent real numbers...but if my prospects generally start at $1K but this year calves the same size are bringing $1K at the sale barn then I am raising my price.  If I didnt I would come out better to just haul that calf to the sale barn because I could get the same price without having to put the effort into a better feeding program to get them started for the show ring, without halter breaking, without clipping, without having to market, without having to deal with a slew of phone calls and bucket kickers.  a couple hours to pull her/him out the pasture, stick em on a trailer, drop em at the sale barn and I got the same amount money. So if I am not gonna make any more money than sale barn price, I am gonna take the easy way and haul em to the sale barn.  We pay more for show prospects because 1 we expect them to be a little better quality than what typically goes through the sale ring and 2) we typically expect that a lot more work has been done with these cattle than what is going through the sale barn.

 

[iowabeef]

True....but I am noticing a lot more $6,500 to $10,000 prices for calves on the online sales that used to be $3,000 to $5,000 type animals....

 

[JSchroeder]

The average price of steers sold online is right a 10% up from last year.

If you are involved in selling show steers in the 1000-1500 range and think you're doing it for the money, you've got bigger problems.

 

[jason]

A lot of skepticism.  The two bigger online auction companies are using maxanet.  I tested in for a month, IIRC the auction company does NOT have direct access to the database.  The actual auction is hosted on maxanet's website.  There was NOT an interface in the admin to change bids, only possibly to cancel a bid.

Now, this would not stop someone from registering a shill account and bidding on their own auction, but that can happen in any auction environment.  You can have phantom or dummy bids in a live auction. 

Take the comments above with a grain of salt, it was 1.5 years when I messed around with it, so it could have changed or I could just be wrong.

 

[mooch]

Now, this would not stop someone from registering a shill account and bidding on their own auction.
Um, yeah . It  don't have to be a shill account either.It's in their own name and how would you ever know? 

 

[forcheyhawk]

Any animal you buy in an auction format - private treaty, online or otherwise could be getting bumped by someone.  Personally, I don't think online auctions are any more susceptible than any other mechanism.  You as a buyer have to figure what you are willing to spend and not be afraid to spend it.  The best way that you can lower your risk of being susceptible to getting the bids bumped is to not be predictable.  Don't communicate up front what you are willing to spend.  Don't have a history of not losing bids.  I'm going to guess (no inside information) the people that get the bids bumped the most are the ones that have a history of not ever losing a bid.  If you have lots of money and like to spend it, I would say send out some smoke signals on some animals you have no intention of purchasing by stopping very early in the bid and losing a few bids.  If you know anything about poker, apply those same mechanisms to auctions and you'll be very hard to bump bids on.  Not saying it won't still happen but it will be hard to figure you out.   ;D <beer>

 

[jason]

Now, this would not stop someone from registering a shill account and bidding on their own auction.
Um, yeah . It  don't have to be a shill account either.It's in their own name and how would you ever know? 

The auction company would have to step in.  Every bid should have an ip address associated with it.  Really not hard to mask your ip through a proxy or take your laptop with you and jump on another wifi connection.  Heck have a friend "bid" on it, but like I said before these problems could happen on any platform. 

 

[jason]

Any animal you buy in an auction format - private treaty, online or otherwise could be getting bumped by someone.  Personally, I don't think online auctions are any more susceptible than any other mechanism.  You as a buyer have to figure what you are willing to spend and not be afraid to spend it.  The best way that you can lower your risk of being susceptible to getting the bids bumped is to not be predictable.  Don't communicate up front what you are willing to spend.  Don't have a history of not losing bids.  I'm going to guess (no inside information) the people that get the bids bumped the most are the ones that have a history of not ever losing a bid.  If you have lots of money and like to spend it, I would say send out some smoke signals on some animals you have no intention of purchasing by stopping very early in the bid and losing a few bids.  If you know anything about poker, apply those same mechanisms to auctions and you'll be very hard to bump bids on.  Not saying it won't still happen but it will be hard to figure you out.   ;D <beer>

(thumbsup)

 

[Still Tryin]

Glad I posted this topic. I haven't participated in one of these types of sales yet, but if you are in the market for a calf, it seems to be there are more and more of these online things all the time. Good suggestions and comments.

 

[Mueller Show Cattle]

Both IowaBeef and Forcheyhawk hit the nail on the head. First you have to do your homework, look at the calves closely prior to the sale and know what you are willing to pay for that calf and don't bid a dime more than that, don't get caught up in the hype of the auctions. Auctions can be very exciting especially live auctions and you can get caught up in it causing you to bid higher than you wanted to. Second study the auction (why I like live auctions) cause everyone knows some auctions prices are high sometimes and some are low sometimes. If you have several calves picked out that you like that are similar in price you are willing to spend and the prices are generally lower except for a calf you like, I would pass on that calf if I think I can get a calf down the line I like for a lower price. I have been to some live auctions where prices for club calves were not much higher than market prices and bin to auctions where I thought the prices were really high (great for the seller). If the prices are high, I don't have a problem going home with an empty trailer, there will be more auctions coming up soon, just look (shop) around as you will be happy you did as there are always deals to be found.

 

[vc]

I think you will see more and more of the on line sales, cuts way down on the overhead.
The outfit we used to buy calves from put on a big sale every year, they would serve dinner the night before for all the people that came to view the cattle, serve coffee and pastries they morning of the sale, tri tip sandwiches for lunch, just before the sale started. I helped setup a few times, the cases of water, soda, and cowboy cool-aid along with other beverages had to set them back a pretty penny. They might have any where 100 to 250 people come through those 2 days and most ate or drank something during their visit. Then you had all the extra help to get the cattle ready for the sale, handle them through the sale and then load them all up after the sale, not to mention paying for the auctioneer. Thay are going to do an online sale this year.
3 to 4 people can handle, rinsing, clipping, photographing, and videoing, all the calves over a couple of weeks prior to the sale, allot cheaper in the long run.

Miss the fun of the sale but I can understand why they went that way.

 

[cpubarn]

Both IowaBeef and Forcheyhawk hit the nail on the head. First you have to do your homework, look at the calves closely prior to the sale and know what you are willing to pay for that calf and don't bid a dime more than that, don't get caught up in the hype of the auctions.

I agree on the above.  I have helped with Online, live and broadcast auctions.  Two main rules.

1) Buyer should set a budget, stick to it.

2) Seller can floor the calf in many ways, but if it sells, be happy.

As long as both stick to the rules, life is fine...

Mark