WASDE: Elevated Corn Use Strains Feed Supply as Mexican Border Closure Clouds U.S. Cattle Outlook

USDA released its latest world agricultural supply and demand estimates report this month, and great numbers appear elevated amid uncertainty about future demand. Crossroads Co Op regional manager and market analyst Brian Irey.

“With the current situation with cattle, they have us feeding 525 million bushels more than a year ago, and there's just no way that that's going to happen with the Mexican border shut down. Now the good news is, the offset to that is we are shipping more corn to Mexico where those cattle will be fed. It's just that it's almost in the balance sheet twice. They're noticing it in the sales and shipments of export corn to Mexico, and they're still expecting it to fall out in the domestic usage for feed. And it just can't be both places.”

Irey notes that feeder cattle would not be approaching $370 per hundredweight if inventory was up. He weighs in with his outlook on what could lie ahead for the cattle market.

“I think it's not going to get better for a couple of years here domestically, and I don't know that we ever get back to the kind of cattle numbers that we had two and three years ago. But at some point in time, you have to be hopeful that this screw worm situation comes under control and we are able to get the Mexican border open back up and get cattle back here in us feedlots.”