CME Feeder Slide Continues

from  The Beef By Cassie Fish, CassandraFish.com

It’s supposed to be a quiet holiday trade, but no one told Jan feeder cattle futures, where the action this morning resembles an express elevator ride with only a down button.

Surprising even bears, Jan has taken out last week’s lows handily, demonstrating that feeder cattle have uncoupled from fed cattle, since cash fed cattle prices traded $4-5 higher 2 days ago and the first 3 months of live cattle futures are modestly higher on the day.

There’s no bearish fundamental news in feeder futures, only extremely light volume, poor liquidity and obviously some worn-out longs deciding enough is enough and heading for the door. It is the market action itself that is disturbing to bulls and casting a sense of unease over the entire cattle complex in spite of Wednesday’s stellar cash cattle trade.

         Fats and Boxes Put on Money

All major packers participated and cash prices bids rose quickly. From last week’s “worst” of $156 to this week’s “best” of $164 it’s been quite a ride in the fed cattle market. Boxed beef values have more than found their legs and put on a quick $5 bucks or so with more to come. This week’s kill is estimated at 400k while next week could come in 465-475k.

         Cold Coming

A shot of sharply below normal cold air will push down as far as the northern Texas panhandle next week. Cattle in some feedyards in Nebraska and Iowa are showing signs of enduring less than ideal winter weather feeding conditions for the first time in what seems like a long time.

         Setting the Tone for 2015 

As we round the final turn into 2015, there is a mixed bag of fundamental and technical indicators for traders to sort through. A sustainable downtrend is unlikely, but taking the opportunity to get front-end fed cattle supplies cleaned up in January when packers resume full kill weeks and the beef pipeline is refilled is none short of critical. Getting “cleaned-up” will go further to setting a positive tone for 2015 than anything will. Clean up coupled with some brisk beef demand into Super Bowl weekend and the fed cattle market can stay on firm footing for months to come.

The Beef is published by Consolidated Beef Producers…for more info click here.
Disclaimer:  The Beef, CBP nor Cassie Fish shall not be liable for decisions or actions taken based on the data/information/opinions.

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Land and Livestock International, Inc. is a leading agribusiness management firm providing a complete line of services to the range livestock industry. We believe that private property is the foundation of America. Private property and free markets go hand in hand—without property there is no freedom. We also believe that free markets, not government intervention, hold the key to natural resource conservation and environmental preservation. No government bureaucrat can (or will) understand and treat the land with as much respect as its owner. The bureaucrat simply does not have the same motives as does the owner of a capital interest in the property. Our specialty is the working livestock ranch simply because there are so many very good reasons for owning such a property. We provide educational, management and consulting services with a focus on ecologically and financially sustainable land management that will enhance natural processes (water and mineral cycles, energy flow and community dynamics) while enhancing profits and steadily building wealth.
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One Response to CME Feeder Slide Continues

  1. futuret says:

    THIS COMING MONDAY, RUSSIAN AND CHINA WILL OFFICIALLY BE EXCHANGING CURRENCIES. UNFORTUNATELY, THIS IS A LINK THAT EVERY SINGLE EVERY SOUL HAS TO TAKE INTO CONSIDERATION. YES, IT SHALL BE PAINFUL FOR ALL OF US, AND WHEVEREVER WE ARE:

    http://www.dcclothesline.com/2014/12/26/mass-murder-widespread-starvation-even-cannibalism-accompany-currency-collapse/

    Like

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