Shootin' the Bull about blowing out the top!

“Shootin’ The Bull”

End of Day Market Recap

by Christopher B. Swift

​3/19/2025

Live Cattle:

While some contend a blow off top to be a day or a couple, this one is 12 days in the running.  This, in my opinion, is the blow off top.  Regardless of how badly one wants to remain in the cattle feeding business, the overwhelming aspect of continually paying a higher price for incoming inventory today, or at anytime in the future, and marketing fat cattle into the future at a discount if forward marketing, or simply assuming all of the risk yourself, is not expected to continue.  I do not expect to ever see an increase in cattle numbers for months, if not a year or so.  I do expect one of two factors, or a combination of both to cause cattle prices to soften.  The first is simply lower consumer demand for which remains resilient, but with some weaknesses showing up towards the consumer.  There is likely to be no rate cuts this year with inflation anticipated to remain elevated and stubborn.  Running the country like a business is most interesting, which seems to have very little history to go by as to if it works.  ​Nonetheless, cattle feeders are the ones to watch as they can do little to spur beef demand, or do much physically to sustain a higher fat cattle price if fundamentals no longer justify the consumers ability to pay current price.

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I will be making further recommendations on Thursday's trading, prior to the on feed report Friday.  

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Feeder Cattle:  

What they can do is stop paying the higher price for feeder cattle, and or, the funds that have influenced the fundamentals, not created them, could begin to differ in opinion as to how much more price advance the cattle market can withstand.  Therefore, at the moment, while backgrounders hold the high ground of a negative basis, get every head you have recently purchased a floor underneath them, in anticipation of the trackhoes coming back out to dig another hole of expectation, "positive basis".  

Corn:

​Corn was higher in the front and lower in the back.  Beans were soft and are expected to remain such.  Wheat has had a nice rally and going into the growing season.  I do know moisture is critical at this juncture with some needing a lot and some having what is needed.  

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Energy/Bonds:

Energy is higher, but not expected to hold.  The Fed left rates unchanged with little likelihood of an increase this year. Bonds are plus on the day, but have been lower for most of.   

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