As tensions overseas continue to boil, the markets have pulled back from their initial response.
We have seen adjustments across the board in stocks, oil, gold and bonds.
For now we are watching and waiting and we’ll see what plays out over the weekend.
Today I wanted to focus on the meats – specifically cattle.
While not as exciting as what’s going on in the news, there has been some interesting things to note.
- Cattle traditionally sells off after the 4th of July – yet it’s quite strong.
- Futures trade at a discount to cash.
- Supply is tight on the back of a few years of high feed costs.
- Corn prices continue to fall boosting margins.
- High packer margins.
So while many are looking for a move lower based on seasonality, we’ve actually just started pushing high over the last few sessions.
So we have mixed signals at the moment and that’s not always a good time to be getting involved.