In nine of the past 10 years, the fed cattle market has moved higher into spring from its January high.

Nevil Speer

January 28, 2014

1 Min Read
Industry At A Glance: Can The Fed Market Keep Climbing?

This January fed cattle market has caught everyone’s attention, and it’s been an incredible run considering that it was trading below $80 just a little over four years ago. Of course, one of the big questions is whether there is room for the market to run even further into the spring. And that’s a hard question to answer given that we’re in uncharted territory.

History, however, is a fairly good indicator of what may come. The market typically moves higher from its January average into the spring highs (February through June) by about $8/cwt. Positive action has occurred nine out of the last 10 years, with the only exception being 2006 when January served as the high point of that spring.   

Fed cattle prices - January to spring high

In the face of ever-tightening cattle supply and declining beef production, coupled with consumers seemingly shaking off the higher retail prices, it appears there indeed remains some potential to work higher yet. Of course, the flip-side of that perspective revolves around consumers and their propensity to keep spending (especially in light of higher utility bills coming in February, which might sour the mood for a month or two).

Where do you see this market headed? Leave your thoughts in the comments section below.

 

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About the Author(s)

Nevil Speer

Nevil Speer serves as an industry consultant and is based in Bowling Green, KY.

Nevil Speer has extensive experience and involvement with the livestock and food industry including various service and consultation projects spanning such issues as market competition, business and economic implications of agroterrorism, animal identification, assessment of price risk and market volatility on the producer segment, and usage of antibiotics in animal agriculture.
 
Dr. Speer writes about many aspects regarding agriculture and the food industry with regular contribution to BEEF and Feedstuffs.  He’s also written several influential industry white papers dealing with issues such as changing business dynamics in the beef complex, producer decision-making, and country-of-origin labeling.
 
He serves as a member of the Board of Directors for the National Institute for Animal Agriculture.
 
Dr. Speer holds both a PhD in Animal Science and a Master’s degree in Business Administration.

Contact him at [email protected].

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