Cattle: End of the Bull Run

[mbdog]

Good luck to you Happy. And Merry Christmas.

[BTO_farmalll]

error,

Who Cares About The Futures!!!!! Cash, All Cash Baby!!!!!!!!! Markets Dont Know Shit!!!!!!!!!!!

[errolanderson]

BTO . . . if it wasn't for the futures market, the cash cattle price wouldn't have gotten this high. Spec-buying contributed to the packer paying up to amazing levels in the end.

Normally, the cash cattle market takes the lead over the Chicago futures. But this last burst in cash cattle bids was spurred by the futures rally. But it also contributed to worsening negative packer kill margins.

Realize producers may cheer buyer losses, but this situation also offers a clear warning that market economics will eventually change.

The cattle board has been extremely overbought for some time, but continued its rally far higher than many expected. This has been the feeder's reward.

But that reward may be at risk over the next few months without prudent price risk management. The peak of the North American cash cattle market is now likely in (IMO) given shrinking consumer wealth, cheaper alternatives and rapidly changing global economics.

[BTO_farmalll]

Oh Good Lord,

Every Time a Packer Opens His Mouth, They Are Losing Money!!!!!! What Else is New!!!!!!!!!!!!

[mcdon]

Errol, you are assuming that the cattle market is trading rationally, that higher prices will attract investment which will increase production and ultimately reduce price. I don't think this has happened, in fact the higher prices has been an incentive for older producers to exit the market, thereby compounding the tight supplies even further. From an economist's perspective the market is not acting rationally. This is where analysts are lost.From a trader's perspective, just follow the trend.

[15444]

A lot of older producers are hanging in, enjoying the ride. But ask if they are willing to go back to $800 kill cows and $600 calves and then you'll know when the 'exodus' is coming.

And they aren't up to their ass in debt like the young guys are, so you know what is going through a young fella's mind.

[bucket]

That would be my expansion point. 800 cows and 600 calves. Stick with it until then.

Kid would get a good start. I hope it hits in 3 years.

[westernvicki]

2006 CHINA imported very few peas, last year the rivaled India at 1 million metric tonnes of peas. The peas, green, yellow and maples went into a very diverse market of products used by variety type into whole for snacks, sprouts and as feed ingredients, fractionated for noodles with a wide array of food & feed ingredients being readily explored.

My guess is with growing demand for beef in China, providing the trading patterns are stable, my guess is demand on this continent will pale to what we can see coming, again used in a wide array of processed products to premium steak as premium steak served as a delicacy finds its way to Asian round tables!

Red meat consumption here will likely continue to decline on shelf prices. However the global market is not to be underestimated in supporting demand and prices.

Will it happen overnight, not likely took 8 years to go from nearly 0 to a million tonnes of peas, but it will happen, and this will underpin prices like China does with global demand of pulses.

Insure trade capacity is working, and logistical channels are efficient to serve these areas, will be the main goal of these markets in Asia, & China.


Again the CTA review needs to insure just in time delivery through the transportation review to enable this and all trade.

[errolanderson]

The supply side remains very bullish, but IMO, you have to follow the money which is the wholesale beef market.

Wholesale beef has turned down. Hedgers; sell those rallies.

[T.N.T.]

End of the Bull Run?Lol I don't think so,but nice try!