It only took a couple of tweets on “X” and a few days to flip the cattle market on its head. That’s the opinion of Cassie Fish, a cattle market analyst and blogger for “The Beef.” She said it’s off-putting to see the cattle market go upside down so quickly.
“It certainly is very disconcerting. I see these kinds of dramatic declines. We’ve seen an almost 10 percent decline in Dec(ember) live cattle, and 11.6 percent in November feeders. It started on the 17th of October, so that is an incredible speed that we have never really seen before, of this magnitude. And unfortunately, people have lost confidence, certainly, in the futures market, and there continues to be some nervousness about additional headlines. You know, if they ease the tariffs on Brazil, for example.”
Despite the fluctuating news headlines that are pushing market prices in different directions, the fundamentals haven’t changed. The U.S. still has a tight cattle supply.
“We do. We have the tightest supply of the entire bull market cycle right in front of us, November into next summer, and the first quarter will be excruciatingly tight, so you’re absolutely correct. But people do remember, you know, the market topped in the fourth quarter of 2014 and went down during 2015, and that was when we also had our tightest numbers. Now, we do not have the same set of demand that we had then. Demand was poor in 2015. Demand has been excellent, despite the fact that we do have record-high prices. We’ve had incredible beef demand for all categories of beef.”
Unfortunately, many in the beef market aren’t focusing on facts, but emotions.
“So, it isn’t the same, but the ‘but’ comes from the ‘but’ people. It just creates worry. It’s just that simple. We’re not over into the quantifying logic. We’ve got the tighter numbers. We have excellent demand. We’re over in the more worried about what might happen or what has happened in the past, and when you change that focus, it really makes it difficult for a futures market.”
Cassie Fish of “The Beef.” You can find her at thebeefread.com.