For the most part, the market hasn’t been bad this fall. It started to pick up in late summer after the initial freakout period over the Tyson plant fire in Kansas. Now it is nowhere near the levels of 2014-2015 but those numbers likely won’t be seen for a little while. The market did dip a tick two weeks ago when I sold some calves, but it has rebounded. I would look for a slight decline around the holidays. Everyone shuts down a week for Thanksgiving and two weeks for Christmas. After Thanksgiving is like the doldrum period for selling cattle. Everyone (from the producer to the packer) will start back up after the first of the year. Prices shouldn’t rapidly decline during this period but they will soften some.
Trade: The first part of the China trade deal is close to being finalized. People are speculating that a reduction in tariffs will come with the signing of the new trade deal but President Trump stated last week that he has “yet to agree to that”. We leveled the playing field with the tariff reduction for Japan. Currently, we have Japan paying a 38% tariff on beef, with the new trade deal the tariff will decline by 9% each year until 2033. Japan had been importing more beef from Australia and South America at a 26% tariff. We do 2 billion worth of business with Japan each year, and that should increase with the reduced tariff.
Mandatory Identification: If you remember I mentioned a few weeks back about the USDA implementing a mandatory electronic identification program for all cows and bulls by 2021. USDA has since backed off of that idea and is contemplating how to move forward. Basically enough people raised cane about it so they are rethinking the move to mandatory identification.
Calves: Steers have been $3-$6 higher, heifers about the same.
Cows/Bulls: Slaughter cows have been $2-$3 higher, Slaughter bulls steady.
This graph is from Josh Maples. Livestock Economist from Mississippi State. Here is where you can see the upswing in feeders from about the last part of summer (end of August) to now. It’s about a $22 cwt upswing.
