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New Mexico | was a 50% Net Up btw.
That would put usa traditional cash fats at $135 by Dec 1st.
Actually the total cattle diametric is currently BETTER than 03 was at this time.
Once again, new high Record exports.
Big usa grind demand.
Fairly low numbers of available cattle, with highest tonnage natural national feed grazing base in 15 years.
$100 traditional type usa fat cattle is a huge physchologic number.
Every farmer and cattle feeder formulas forward to that...
SOO would imagine once a very short temporary bounce Back to say $101 after the next couple weeks $103 to $107 trade.
Takes $102/3 for a minimum open down here next week.
Most of it will trade at $103 to $105.
What happened in the last major formula forwards from May...is very simply that supposed "wall" of cattle the supposed marketing experts talked for Sept / Oct does not exist.
If one was watching placements in May/June, most were leery of placing cattle for the fall time frame.
That was very obvious with numbers placed off approx 75% ( for 2 reports in a row ) compared to same time frame 09.
The current Comp cutout report shows shipments of sales 3 weeks and out are Up say 18% ( compared to 09 ).
Total forward sales are Up approx 48%, and exports sales up say 35% ( compared to 09 ).
Only mildly bullish here.... Say $117 cwt traditional cash fats usa Mid Oct.
THEN we run to the $135 to 140 level by spring 011.
It's going to take a couple years of the $125 to $140 fats, $150 kinda yearlings and say $200 cwt calves
for folks to TRUST enough, then start to enter or rebuild the usa beef industry.
In the meantime we'll keep harvesting most all the hiefers which makes for less tonnage annually AND less total cattle numbers annually too.
The more the beef industry declines now...the higher they're going to get.
Interestingly the higher they get...the more we sell into it thus further reducing forward supplies and tonnage.
The same scenario which played from May 010 thru now...will continue to play time and time again for perhaps another decade.
We'll have 10 million less stock cows ( 1/3 less than currently ) by 2021 ( current pace of decline factored ).
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Markwright
