Cheap grain has allowed the U.S. livestock sector to grow. The latest crop report from the USDA shows more cattle producers are feeding corn than wheat to their herds, which is beneficial to get them to grow.
Doug Werling of Bower Trading, Inc. thinks this expansion in cattle is warranted now that China has opened their market to U.S. beef.
Demand in Japan for U.S. beef is expanding as well, despite the tariff Japanese officials leveraged on the product last year. That tariff is expected to be lifted in March.
“We have seen the overall expansion supply in the U.S. be supportive and help support prices because of the global growth situation,” he said on AgDay. “Once you get a taste for that, and you have more money, you’re not going to go back on it.”
Hear Werling’s thoughts on if grains can get enough demand from livestock to see better prices on AgDay above.