Cash cattle continue to out perform the expectations of many. Supply of cattle is still tight with peak demand upon us. Packers are slowing chain speed down to try catch up on leverage, but producers still hold the cards.
Northern cash trade was another $5 higher with $228 hitting a bulk of the action, and the south followed with a range of $218-221. Grid trade was also noted with great premiums. The north has rallied $5 per week since $208. It has been many years since negotiated cash had choices like this last year of trade.
Demand is still strong for beef even with the higher prices. Further rationing may need to happen with the next generation of beef consumers showing a strong increase in consumption. Imports are substantially up with the need for more grinding meat. Last week I just heard the rumor that ground pork might be an avenue to mix with beef to make it more affordable. Though flavor and quality would be great, there is just something about giving an inch to that if you are a beef producer.
Prices are high, and it sure is a lot of fun. However, we are all nervous handling this many dollars. Nobody knows where the high is, and make sure to take care of the risk that you need. Wrong decisions are highlighted quickly with an ever-changing market. Have a good week.
Kooima Kooima Varilek Trading
The risk of loss when trading futures and options is substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.