Next Week’s Video Sale Could Give Cattlemen a Glimpse of Possible Fall Feeder Cattle Prices

What a crazy time in which to be living and witnessing the developments in the cattle market. Both fat and feeder cattle prices are trading at near historical highs and with supplies not expected to rebound anytime soon — it’s anyone’s guess what fall feeder cattle prices could do later this year.

There are compelling arguments to be made on whether the market has any more upside potential left in its current bullish run. But regardless of what side of the argument you find yourself on, the only true deciding factor will be the market — the buyers and sellers on that day and price discovery.

THE BULLISH OUTLOOK

From a supportive bullish outlook regarding upcoming feeder cattle prices, one cannot deny supplies of feeder cattle will remain limited well through the 2024 calendar year and into 2025. If we look at the CME Feeder Cattle Index and what it’s telling us about current feeder cattle demand across the nation in sale barns — it is evident buyers are still well engaged in the market. Last September the CME Feeder Cattle Index peaked at $254.09, and on Tuesday (6/4/2024) the CME Feeder Cattle Index closed at $250.89. And there is the old-time cattle feeding mentality that if you’re in the business of feeding cattle, it’s pretty hard to make money feeding cattle if you’re not feeding cattle.

THE BEARISH OUTLOOK

From a cautious, more skeptical standpoint, there are fair reasons to believe the feeder cattle complex may be already trading at its upper end. From a technical standpoint, the board seems to be running out of momentum, and with external pressures seeming to affect the cattle complex more and more, the board’s strength and overall confidence seem less reassuring. Not to mention, cattle buyers have been extremely aggressive in procuring calves/feeders early this year and feedlots are full throughout most of the five-state feeding region. While feedlot managers are keenly aware that in order to play the game, they have to continue to keep their bunks lined with cattle, configuring positive break-evens on feeder cattle at the market’s current price isn’t an easy feat.

Next week, on June 10 and 11 Superior Livestock Auction will host their first big summertime video auction, the Corn Belt Classic, where 61,705 head of cattle are cataloged to be sold. This sale will give the market a better understanding of buyers’ needs, and what one could potentially expect for feeder cattle prices this fall.

I highly recommend you tune in and watch some of the sale, especially for the cattle selling in your region. But if you’re not able to, don’t worry because next Friday, June 14, DTN will be hosting an Ag Summit Series seminar solely focused on cattle. The seminar, “Navigating the Cattle Market’s Ups and Downs,” will feature two presentations, one by me addressing the current cattle market and what may lay ahead for the rest of the 2024 calendar year, and another session by Rabo Bank focused on LRPs. If you’d like to register for the series, click the link here: https://dtn.link/AgSummitSeries-Summer

ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com