#CattleCon Crystal Ball
Last week’s Cattle Industry Convention delivered a mixed bag of predictions for producers.
CattleFax’s CEO outlined a pandemic-fueled combination of shrinking cattle numbers and record demand hitting just as exports increase and harvest capacity grows, which puts power back in the hands of cattle producers.
And the general economy plays a part, too. Its bounce-back is bringing along inflationary pressures, but consumers continue to buy beef even as prices climb. It is what’s for dinner, after all.
CattleFax’s prediction? Fed cattle prices jumping from $121 to $135 per hundred, with peaks reaching $145 per hundred. Feeder cattle will feel the rising tide too, up to $200 per hundred from the $170 average in 2021.
Zoom out: Cattle prices have been on a bit of a roller coaster, dropping sharply in 2020 but making a full recovery. In current market conditions, producers can maximize the market by forward selling, buying call options, and buying puts—or asking their trusty Magic 8 Ball.
But not all good news: For some producers, lack of rain is overshadowing the market impact. Drought conditions across the upper Midwest and High Plains are drying up pastures and hayfields, leading some to depopulate their herds.