Cattle put in a mixed performance this week giving both sides something to talk about. Volatility is increasing, which is a sign of a potential topping action. The fact that both live cattle and feeder cattle traded to new all-time highs added the potential topping action. But cattle fundamentals continue to be friendly cattle which was evident in the Jan COF report and expectations for a friendly Annual Cattle Inventory report Friday afternoon.
What was impressive, President Trump confirmed hit decision to place 25% broad based tariffs on Canada and Mexico starting Feb 1, and although Canda has not yet responded to that news, Mexico has responded by placing tariffs on some US products, but beef was not one of them.
Cattle started the week mixed with live cattle trading with gains while feeder cattle saw strength in the front month Jan but pressure in the deferred months. Cattle shot higher on the opening bell with early support coming from Friday’s bullish COF report. The report showed less cattle in feedlots than expected and sharply lower placements than expected. Marketing was as expected. The early session strength was enough for cattle to post another new all-time contract high before pulling back on technical selling and profit taking. Strong cash bids and tight supplies continued to support the live cattle.
Strong gains were seen on Tuesday as live cattle traded to another new all-time contract high while feeder cattle closed with strong triple digit gains across the board, but only the front month Jan traded to a new all-time contract high. Cattle opened higher across the board and waffled a little bit at the start but found strength and forged higher. Reports of cash activity taking place between $210 and $212 helped to support cattle. The broken record of tight supplies, strong demand, and strong cash bids all helped give cattle support. The lack of news on the timing of the reopening of the Mexican border added support.
Selling took charge in the cattle market’s midweek with both live and feeder cattle seeing heavy selling pressure. Cattle opened on the defense and extended session losses throughout the session with selling tied to profit taking and technical pressure. Tuesday live cattle traded to another new all-time contract high while feeder cattle closed at all-time highs. Wednesday appeared to be a day for taking profits and money off the table. Position squaring ahead of Friday’s Cattle Inventory report added support.
Cattle continued to see pressure to close out the week Thursday. Cattle opened the session steady to firm but faded its gains early, which triggered the algorithm traders to start selling which lead to weak longs exiting positions ahead of Friday’s Annual Cattle Inventory report. Rumors that the Mexican US border will soon open to allow Mexican cattle back into the US added pressure. Last week’s beef exports were estimated at 20,166 MT, which is a marketing year high. Position squaring ahead of Friday’s Annual Cattle Inventory report was also evident. The cash feeder cattle index increased 39 cents to $279.45.
The Cattle Inventory report was neutral to friendly cattle as most of the numbers came in as expected, except for beef heifer retention, which was below expectations. The report did not confirm herd expansion.
For the week, Feb live cattle were at $204.60 down 17.5 cents. Jan feeder cattle went off the board at $281.90 up $3.20 while March feeder cattle were at $$275.725 down 85 cents.
For the month, Feb live cattle were up $13.00. Jan feeder cattle were up $18.875 while March feeder cattle were up $12.75.
Cattle Weekly Comments January 31
Cattle Weekly Comments January 31
Cattle put in a mixed performance this week giving both sides something to talk about. Volatility is increasing, which is a sign of a potential topping action. The fact that both live cattle and feeder cattle traded to new all-time highs added the potential topping action. But cattle fundamentals continue to be friendly cattle which was evident in the Jan COF report and expectations for a friendly Annual Cattle Inventory report Friday afternoon.
What was impressive, President Trump confirmed hit decision to place 25% broad based tariffs on Canada and Mexico starting Feb 1, and although Canda has not yet responded to that news, Mexico has responded by placing tariffs on some US products, but beef was not one of them.
Cattle started the week mixed with live cattle trading with gains while feeder cattle saw strength in the front month Jan but pressure in the deferred months. Cattle shot higher on the opening bell with early support coming from Friday’s bullish COF report. The report showed less cattle in feedlots than expected and sharply lower placements than expected. Marketing was as expected. The early session strength was enough for cattle to post another new all-time contract high before pulling back on technical selling and profit taking. Strong cash bids and tight supplies continued to support the live cattle.
Strong gains were seen on Tuesday as live cattle traded to another new all-time contract high while feeder cattle closed with strong triple digit gains across the board, but only the front month Jan traded to a new all-time contract high. Cattle opened higher across the board and waffled a little bit at the start but found strength and forged higher. Reports of cash activity taking place between $210 and $212 helped to support cattle. The broken record of tight supplies, strong demand, and strong cash bids all helped give cattle support. The lack of news on the timing of the reopening of the Mexican border added support.
Selling took charge in the cattle market’s midweek with both live and feeder cattle seeing heavy selling pressure. Cattle opened on the defense and extended session losses throughout the session with selling tied to profit taking and technical pressure. Tuesday live cattle traded to another new all-time contract high while feeder cattle closed at all-time highs. Wednesday appeared to be a day for taking profits and money off the table. Position squaring ahead of Friday’s Cattle Inventory report added support.
Cattle continued to see pressure to close out the week Thursday. Cattle opened the session steady to firm but faded its gains early, which triggered the algorithm traders to start selling which lead to weak longs exiting positions ahead of Friday’s Annual Cattle Inventory report. Rumors that the Mexican US border will soon open to allow Mexican cattle back into the US added pressure. Last week’s beef exports were estimated at 20,166 MT, which is a marketing year high. Position squaring ahead of Friday’s Annual Cattle Inventory report was also evident. The cash feeder cattle index increased 39 cents to $279.45.
The Cattle Inventory report was neutral to friendly cattle as most of the numbers came in as expected, except for beef heifer retention, which was below expectations. The report did not confirm herd expansion.
For the week, Feb live cattle were at $204.60 down 17.5 cents. Jan feeder cattle went off the board at $281.90 up $3.20 while March feeder cattle were at $$275.725 down 85 cents.
For the month, Feb live cattle were up $13.00. Jan feeder cattle were up $18.875 while March feeder cattle were up $12.75.