Market Paradoxes

Cattle market responses to recent market turmoil.

Economists often say market prices are determined by demand and supply. What they really mean is more correctly stated as “market prices are determined by expectations of demand and supply.” Under more stable and normal circumstances, this distinction is not particularly significant. However, the current market situation creates significant disparities between the current supply and demand situation and expectations for coming supply and demand conditions. The result is a number of seeming paradoxes between different cash cattle and beef markets and between cash and futures markets.

Beef Is Most Valuable Protein

When beef is in the shopping cart, retailers earn more.

More than 1,500 attendees, including retailers, processors and packers attending the 2020 Annual Meat Conference in Nashville, Tenn., learned that beef is the most valuable protein in terms of sales and how the beef industry’s Beef Quality Assurance program is helping to improve consumer perceptions about how high-quality beef is raised in the United States.

Global Pandemic, Economic Hibernation Disorients Markets

Labor and supply chains among the biggest challenges facing essential rural industries.

COVID-19 has brought the U.S. economy to a screeching halt, ushering in a recession in the process. For most businesses, the sudden stop to the economy is more jolting than the financial crisis of 2008 and has forced hard, immediate decisions about employees and finances. According to a new quarterly report from CoBank’s Knowledge Exchange, COVID-19 has also underscored the critically important nature of agriculture and other industries essential to rural America.

Mostly There

A steady supply of Prime beef is still needed to encourage retail sales.

Marbling, marbling, marbling.

Don’t we have enough of this “taste fat” in beef cattle today? Isn’t it time to move on?

It’s still a big deal, especially when more than 92% of cattle don’t have enough to qualify for the Certified Angus Beef^® brand.

In The Cattle Markets

Risk-off.

So, in the second week of March, oil prices are down about 20%, and a variety of stock market index futures are off at least 5%. It’s a great opportunity to write about cattle markets. No, not really. In actuality, it is a good opportunity to review market fundamentals after we contrast them with unknown unknowns as revealed by recent charts. The outbreak of respiratory illness caused by a novel and new coronavirus, identified as COVID-19, continues.