Market Summary

Slaughter cows and bulls $5-8 lower. Just lots of cows around. Don’t expect this to last too long. The cows will dry up within a month. Feeder cattle sales have slowed up a little too but the market is still at record highs. I just wanted to share some thoughts about pre-selling calves for fall delivery in this market.

1. There’s a sense that the market is as high as it can get so people don’t want to miss out on record prices. That may be true. No one knows. But there is no evidence, fundamentally or technically, that this is true. In fact, all signs point to higher highs in late 2025 and all of 2026. We will not see the highs in this cycle until heifer retention begins in earnest and all the evidence suggests this is just beginning , if it is at all. The last few weeks have erased drought in most of cow country in the US so all eyes are on them to see if producers will begin retaining heifers. I believe in the cattle cycle, it’s the most predictable economic cycle in the world. The tightening in supply is just beginning with the price highs in this market ahead of us.

2. As of last Friday night CanFax reported that all calf and feeder sales were only up 2% over last year. This includes all the forward priced calves and yearlings so far this year. We know that we had less feeders and calves in inventory as of this year because the cow herd is record small, so there was less to begin with. The net effect of this is that the supply of calves and feeders available for purchase this fall just got a lot smaller. This could result in a very competitive price environment.

3. The fundamentals of the market remain extremely sound. Retail prices remain very resilient. Trade issues have faded a bit. Packer losses have been markedly reduced in the last 2 weeks and kills are getting bigger. Supply of feeders is tightening dramatically. Feedlot profits have been record large all spring and summer.

So, to sum up, just because the market is as high as it’s ever been doesn’t necessarily mean that it’s as high as it’s going to get. Markets keep going up until they start going down. No one knows. I’m just saying that there’s no reason yet to think that the highs are in.

Have a good week. Ian