Markets — April 8, 2016
Compared to last week, calves and yearlings traded mostly steady to 5.00 lower, with instances 10.00 lower. Early week most sales were steady to instances higher but Wednesday’s collapse in the cattle futures pressured the market. Market softness prevailed last week with cattle futures seeing some limited downside pressure, trying to find some stability before Wednesday’s free-fall. The return of volatility with defensive futures and with cut-out values also imploding on Wednesday with choice closing 3.19 lower put cattle market psychology in a black mood. This makes all participants in the cattle market very leery but then no one wants to be caught with empty pens or pastures if profit opportunities appear. These are the results of an industry yearning for profits as volatility the only rule that cattle markets have abided by since last fall with many unpredictable attitudes directing market direction. Then on Thursday cattle futures saw a sharp reversal as the USDA Grain Report was bearish for grain (especially corn) with feeder cattle futures turning bright green with limit gains. This week saw many soft fall-born new crop calves making their way to the market and in many cases widening the price spread against the rugged old croppers. In addition to market pressure on feeder calves, many lightweight offerings in the coming weeks will be overwhelmingly made up of new crop fall born calves which are not always in high demand by feeder buyers as many are unweaned and carrying plenty of flesh.
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A new book describing the events leading up to the Beef Checkoff’s implementation and outlining a vast number of happenings since then has caused quite a stir.