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North Central Texas |
Market fundamentals have done as they should as far as impacts to the market.
So 3 things happened that created our situation today.
1. Cow/calf guys held on longer looking for better markets.
2. Drought and $6 wheat took a home for 4 million head and greatly reduced it putting more calves on feed that normally would hit slaughter a few months later.
3. Packer said they didn't care how heavy and feeders made the same move they always make that's hurts the market the most - they made em big.
So we have a bubble of some fats that are late, some on time and some early instead of just the on time ones that should be there. Extra cattle extra heavy lowers the price.
This bubble will hold for several more months.
Price of supply is dictated by the price a seller is willing to offer his goods. That sets the price of that commodity. Fats are selling everyday. Makes them easy to sell when they could be fed for free. Rising corn prices were a blessing to those guys who placed cattle this fall. Corn hedges paid off big.
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Fundamentals don't mean squat
