Robust Cattle Prices

Jan 19, 2024

Prices for cattle strengthened in 2023 and more increases could be in the future. Recent prices for 500-600 lb. feeder steers in Nebraska were around $305 per cwt. compared to $220 a year ago. And while prices for live steers are off highs of a few months ago, recent sales at $174 per cwt. are higher compared to $156/cwt. at this time last year. The USDA WASDE projects lower beef production this year, projected down over 1 billion pounds. Meanwhile, domestic demand for beef is resilient. Kansas State University’s choice beef monthly demand index for October was higher compared to January 2023—a sign consumer demand is still steady. Beef exports, though, were lower in 2023 and are projected to fall even further in 2024.

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Video: U.S.-China Trade “Truce” + U.S. Fed Cuts Rates Again

The market was hoping for a US-China trade deal, but we got a trade “truce” for now from the keenly awaited Trump-Xi meeting at the APEC Summit.
China commits to minimum purchase commitments of 12 MMT of U.S. soybeans during the “current season” and a minimum of 25 MMT annually through 2028.
U.S. Treasury Sec Bessent said other Asian countries have agreed to buy additional 19 MMT of US soybean.
Soybean futures trading above $11 now- they normally tend to rally to $12.
As expected, US Fed cuts interest rates by -0.25% again in October to 3.75%–4.00%. No further cuts promised for this year but trade looking out to the Dec FOMC.
The Bank of Canada cut interest rates to 2.25% but raised concern over trade war damage.
Soy meal futures, remarkably, have had 14 consecutive higher close sessions. A bull market in soybeans is a bull market in soy meal!
Cattle futures lower as funds unwind out of cattle for now due to Trump headlines and objective to lower beef prices.
All major stock indices climb to new record highs. It was Mag 7 reporting week, which had mixed results. But we now have the first $5 trillion company in Nvidia!