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

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

Nevil Speer

Nevil Speer works as an industry consultant based in Bowling Green, Kentucky.   He has experience in both academia and private industry.  His career includes working with several start-ups along with various service and consultation projects spanning a wide variety of topics.  

Dr. Speer holds a PhD in Animal Sciences from Colorado State University and an MBA from Western Kentucky University.

You can contact him at [email protected] 

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