Cattle Market Sensitivity

Recent Comments from the Trump administration about the beef industry and its goal to lower consumer beef prices have had a major impact on the cattle markets. R-CALF United Stock Growers of America, CEO Bill Bullard, explains the market's reaction, but

“What that indicated to us, what was a clear indication was that the marketplace is broken because the market responded in a very wild fashion just Upon the announcement of the President, and it tells us that our market system is entirely broken, that the market is too thin. When a market reacts simply to statements and rumors, as our market does. It's an indication of market failure in the

industry.”

The recent events of comments have proved the volatility of the market.

“We saw that first the markets collapsed after that announcement, and then the Secretary of Agriculture talked about the plans on the New World screw worm, and that sent the market reeling again. And a market shouldn't do that. A robust market wouldn't do that, but an ultra thin market like we have in our cattle industry today is one that is highly sensitive to any adverse information, and it overreacts.”

Bullard says they also want the operations of the CME and feeder cattle contracts investigated to determine whether market manipulation is allowing large corporations to profit from a system meant to help producers manage risk.