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Cattle Call
7 - 24 - 2026
Cattle futures had a mixed week after 3
big down ones in a row. It
would appear to me as though this recovery is due to short profit
taking for the most part. The market rallied off of the measurements
from the gap we left on 7/14. Strong technical move. I can't point to
any fundamentals as to why it would catch right here. This level of
volatility seems to be a normal for the cattle complex. It is a function
of the market to overdue itself.
Packers have no doubt played their hand
in recent weeks to gain
some leverage back over the producer. Lower boxes, kills cuts,
cooler clean outs, etc. $365 traded in the north this week. I would
caution against holding inventory through this period to wait for
higher prices. Given current circumstances, packers have no
incentive to raise prices to procure inventory. We are in the seasonal
dog days of summer.
Cash feeders have been softer this week,
which is overdue. Cash
feeders that are $400/hd behind at the time of placement does not
seem very sustainable long term.
Long term supply outlook is still very limited.
The market does have
real potential to rally again. Boxes need to rally. Feedlot inventories
need to stay current. I would advise caution though. The story is
currently changing from a supply story to a demand and import story.
I am not saying that supply wont be the story again, but currently its
not. We need to be aware of what story the market is trading, even if
it doesnt fit our narrative.
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.
Dallas Granstra
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