Beef Market Update: Bearish corn, international market demand, and weather unknowns


In a stroke of good luck, both Anne Wasko of Gateway Livestock Exchange and Shaun Haney, host of RealAg Radio, were in San Antonio, TX this week to take in the National Cattlemen’s Beef Association’s annual convention.

That means this edition of the Beef Market Update is a very special in-person recording, which makes the rest of the RealAg team slightly jealous of both the visit and the many delicious steaks consumed.

It also means there’s a whole lot of beef market information to wade through. In this update Wasko and Haney start with CattleFax numbers from a Canadian perspective. There were no real surprises on the supply for sure, she says, but changes on the trade front for beef and proteins, specifically, looks “friendly” going forward.

Moving on to the U.S.-China Phase One deal, there have been some questions regarding if the U.S. can ship beef with Ractopamine into the country, and to clarify, that is not the case; but there is some research around the use of the feed additive going forward.

To the good, the talk at the convention has been about bearish corn prices — a positive for feed costs — but Wasko warns cattle feeders not to get complacent, “There’s lots of weather yet to get through,” she says, with the potential for plenty of  volatility and black swan events to come. So far, weather analysts are predicting a La Niña event, which could mean a turn to very dry in the back half of the year for areas such as Texas. And what happens in Texas greatly impacts the U.S. cowherd numbers, according to Wasko.

There are still big questions surrounding China and the full impact of the coronavirus and the full effects of African swine Fever. With at least a 50 per cent reduction in the hog herd there, there’s sure to be a big demand for beef and other proteins to support the beef market for 2020.

“Watch for those (pricing) opportunities to manage that risk,” Wasko says.

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