Uncertainty is Impacting Cattle Prices

Cattle and beef markets have decreased from April highs with uncertainty in a variety of factors weighing on markets the past month. The latest threat of additional tariffs on Mexico rattled many markets last week, including cattle and beef markets. It appears that the threat was removed over the weekend and cash and futures markets may stabilize somewhat this week; but ongoing uncertainty about trade and the politics of trade continue to take a toll on agricultural and other markets.  Weather is another source of uncertainty negatively impacting cattle markets. While good moisture conditions bodes well for forage growth in general, ongoing flooding and excessively wet conditions is limiting grazing and hay production in some regions. Sloppy feedlot conditions continue to hamper feedlot production in some areas. Additionally, the record late planting of corn and soybeans this year is adding uncertainty about corn acreage and yield and is beginning to push corn prices higher. There is little doubt that the corn crop will be smaller than anticipated just a few weeks ago but carryover levels are still expected to be adequate. While significantly higher feed prices are not anticipated at this time, the uncertainty remains. Weaker beef demand may be the biggest threat to cattle and beef markets for the remainder of the year. Strong beef demand supported cattle and beef markets in 2017 and 2018 but there are signs that some weakness may be developing in beef demand in both domestic and international markets. While unemployment remains very low, other indications of weakness in the…

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