Live cattle futures ended the day lower after the USDA issued a statement saying “depressed prices are expected to carry into 2016.” Live cattle futures ended down $1.025 per pound today settling near $124.50 per CWT at the Chicago Mercantile Exchange.
The pendulum does swing the other way as just last year it was the feedlots and packers making the money from high beef prices, but now the retailers are finally being handed significant margin opportunities due to beef market dynamics and cattle prices near three-year lows. This downgrade from the USDA was just issued last week when the statement was made for the benchmark fed steer values..
Devin Brady, President of Progressive Trading Group in Sherman Oaks, CA, shared his fundamental view of the cattle futures market by stating, “Beef prices (cattle futures) have been steadily working its way downward since summer, but accelerated lower in early November.” Brady adds, “Hopefully a strong US Dollar will help boost needed beef exports to stabilize this market.”
Cattle futures trend is down with no bottom in sight. Cattle futures are supposed to “predict” where beef prices are headed, so this is a plus for consumers as well as families.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.