Feeder Cattle Prices 'A Little Scary'

November 23, 2015 12:00 PM

Although the feeder cattle market will find support in sale barns in the weeks ahead, the overall price outlook for that sector of the cattle industry and others isn’t so rosy, according to DuWayne Bosse of Bolt Marketing.

“It is definitely a little bit scary,” Bosse told “AgDay” host Clinton Griffiths on the Agribusiness Update segment for Monday, Nov. 23.“Right now, June feeder cattle are at $160, which is lower than where we were selling cash fat cattle last year.”

It’s true cattle made a nice V-shaped bottom this fall and staged a great rally in October. Times have changed, though.

“You look at the long-term outlook of cattle (and) it gets pretty negative for me going into 2016,” Bosse said. “The biggest thing is you look back on all commodities, back from the big commodity boom that started in ’08. Cattle is the one thing that hasn’t dropped back to where it was before this big boom. You start looking at the dollar. You can tie the dollar to everything because the high dollar means less exports, more imports.”

Although Bosse is most concerned about the fat market price outlook, he’s optimistic farmer-feeders will take the opportunity to reenter the market this winter because of low feed prices.

“They’re going to move their corn off their farm, but it might not be in a truck,” Bosse said. “Maybe it’s a truck and trailer with cattle in the back because I think they’ll start buying these calves.”

The holidays could also provide a temporary burst of energy as consumers purchase more choice meat, he said. Still, the overall price outlook will trend lower into the New Year.

Click the play button below to watch the complete “AgDay” interview with Bosse. 

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