Cattle Industry Signals

USDA’s latest cattle on feed report came as little surprise, with prices still trending higher, many in the industry expected a more bullish outcome, but the numbers came in quieter and below expectations still. American Farm Bureau Federation Economist Bernt Nelson says that the report carries important signals for the market.

“If we kind of take a look and break it down, we've got 10 point 9 million head total on feed as of last month, down 2% from last year. But if we break this down and take a look at placements and marketings, to me, this is where more of the story is, both down 6% were marketing about the same number of cattle that we're placing on feed. So this is a consistency that shows where we're a little bit tighter on our cattle supplies overall, and what we're placing on feed versus what we're processing for beef. And I think that's kind of overall, if we look at this in a long run, it's it's actually pretty bullish in the long run, in the short run, since the industry was kind of expecting a bigger slowdown than this. I think maybe the markets, as we've seen kind of today, going into Monday, the futures response has been a little bit down. I wouldn't expect a down day in the cash, and I think that's what most guys are going to be looking forward to as we go throughout this week. Is where we're headed in cash, and why we're going there.”

American Farm Bureau Federation economist Baron Nelson, that is today's line on agriculture report. I'm Lorrie Boyer for the Ag Information Network.