When the live cattle futures are limit up, it’s a good day for cattle feeders. In these turbulent trade war times, any of the commodities will take a positive day. Cattle futures have been somewhat separated from the downward swing of soybeans, lean hogs, and wheat, but sometimes commodities are guilty by association.
The table below shows that even though the past month has felt turbulent, October Live Cattle is up 5.175 (+4.94%) in the last 30 days. Comparatively, October Lean Hogs were down 3.875 (-6.09%).
What we saw this week:
- The cash market dropped two to three dollars to $106 mid week but was back to $108 by the end of the week, which pushed the futures higher after a tough start to the week due to a bearish cattle on feed report last Friday. The table above shows that over the past five days, October Live Cattle finished $0.625 (+0.57%) higher.
- Demand has been strong headed into the long weekend which is a must considering the supply of beef and pork needing shackle space. There is concern over the trade issues that pork could have with China in the 2nd half of 2018 and how that filters down to beef.
- The Canadian Dollar has snuck above 76 cents and will be definitely worth watching after the Canadian retaliatory tariffs are implemented on July 1.
- Feed prices have been attractive with the drop in corn futures and it has presented opportunities for feedyards to lock in feed costs.
- Pasture conditions continue to create feed concerns for ranchers on the prairies and will impact when cattle are placed in feedyards.
Enjoy this weeks edition of the Beef Market Update with Anne Wasko