Sort and Cull

If you feel like you're frantically juggling glass balls while keeping track of where the market's currently trading, or forging through unknown territory of the wide-open, wild west -- you're not alone!

Week in and week out the cattle complex continues to surprise us all and although it's critically important that we stay engaged and invested in the marketplace and what clues it may be trying to point to, we must also respectfully understand this market is truly a beast of its own, and it's not going to abide by the normal rules of law and order, or what we'd typically expect to see in the cattle complex.

For those of you who were busy last week, let me share with you some of the glass balls the market was juggling while you were away. For starters, it's wild to realize the feeder cattle complex traded within a $6.00 window last week. It feels like the market gives and takes in wild increments right now -- because it does! The days of seeing $1.00 higher or maybe just $2.00 higher or lower is not the current state of the industry. Algorithmic trading is quick to send signals to overdo any move, and anyone even slightly invested in the cattle complex knows that, given the sheet price point of the marketplace, volatility is a bigger issue than potentially anything else.

Secondly, the fed cash cattle market was a wild card as well, as there were no negotiated cattle traded last week in Texas at the submission time for USDA's reporting. Simply put, feedlot managers dug their heels into the ground and said they weren't going to trade cattle unless packers upped their ante -- and by golly, they didn't. I think it's utterly incredible, and I have so much respect for those managers who have elected to stay engaged in the marketplace despite prices being historically high, so they can say they squeezed every dollar out of the market that it had to offer week in and week out.

And last, but not least, throughout the week we knew U.S. Ag Secretary Brooke Rollins was going to have a big announcement Friday afternoon regarding New World screwworm, but didn't have any of the details until her announcement late in the week. Some were worried the announcement was going to consist of a date for allowing Mexican cattle to be imported into the U.S. again. However, thankfully, that wasn't mentioned at all. Instead, Rollins shared that a $750 million domestic sterile fly production facility was going to be established in Texas to help protect U.S. cattle from the infectious parasite. DTN's Senior Livestock Editor Jennifer Carrico wrote in length about the announcement here: https://www.dtnpf.com/….

So, if you feel tracking the cattle complex has been a bit much lately, I'm here to tell you that's because it has been! Even though prices are historically high, the market has been dealing with incredible pressure as it weighs the technical, fundamental and outside factors of the world. But even so, it's our job to keep engaged so we can make the best financial decisions possible for our businesses. Carry on friends, there's a new week ahead of us and new hurdles to conquer!

ShayLe Stewart can be reached at shayle.stewart@dtn.com

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