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Veteran Contributor

Cattle and hogs

Cattle On Feed, Cold Storage and Hog and Pig Reports all out in the last week.  Cattle and hog numbers are increasing.  Beef in storage keeps blipping higher while pork has enjoyed good demand.  It has been a good run.

 

I think we are at a critical point.  Cattle may shoot wright to the moon(over $170) or it may shag down to the $140 area.  Makes life interesting. 

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Veteran Advisor

Re: Cattle and hogs

for perspec(tive) - world pop consuming meat/grain is growing exponentially....so every physical change in supply now has a much larger response both ways.

 

we have just recently begun in last 5--7 yrs - a multi-decade higher priced // higher volatility grain and meat markets!

 

so every little economic change has more horsepower to move the market....I've been trying to wrap my head around it studying balance sheets....it's math-calculus-derivative-parabolic --- a NEW mkt in one, if u will, all wrapped, wrighted, marked, donned and shagged together...

 

the linear 'appearing' USDA balance sheets are becoming more and more of a distortion of reality --  if they've propped up a bu here and there in supply and subtracted a bu likewise in use - u can bet the actual affect is parabolic to the marketplace.

 

elephant in the room really is getting bigger, my friends. Merry Christmas

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Veteran Advisor

Re: Cattle and hogs

Global GDP is quite a ways above a year ago..on average it's about Double last year.

 

Cattle numbers in the usa, IF they ever increase will take until 2018.

keep in mind the heifer saved now and calfed in 2016 does not result in a beef increase until her 2nd calf in  2017 and harvested in 2018.

( the 1st calf replaces the heifer which came out of the 2015 fat harvest )

 

why not cattle to $340cwt? 

that's only $2.20 of beef in a quarter pounder.

bet someone else offshore will buy that if the usa folks think it's 2 high.

 

 

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Veteran Contributor

Re: Cattle and hogs

I think you are right, cx1, on parabolic market moves.  Look at the stock market, housing market, farm ground, grains, metals, computers, meats... in the last 7 years.  Gas prices went down 1/3 in a couple months.  Mabye meats are at ground floor on this move but I have my doubts.  Cattle have been on a good run the last 4 years.  Up 40% in the last year and a half.  Timing is key.  I appreciate the wright optimism but when I pay $2 for that 1/4 pound, combined with higher minimum wage,  I'll porbably be grumbling as I pay for my happy meal.Smiley Happy

 

Merry Christmas one and all!  I appreciate the dialogue.

 

 

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