Feeder Cattle Market Comments – 7/27/2023

Feeder cattle futures prices appeared to, at least temporarily, have stalled after a major winter – spring bull market. The accompanying scatter studies display autumn  feeder cattle values (high & low range) as a function of the supply of feeder cattle on July 1. USDA data put the mid-year 2023 feeder supply at 34.3 million head, just exceeding the modern all-time low  of 34.2 million head in 2014. Note that the current 2023 (marked in red) price is near the high & well above the low price suggested by  the historical experience

Feeder prices have a seasonal upward bias as demand for cattle feedlot placements is strongest in the fall. This year feeder prices may have overshot the seasonal price advantage.   The seasonally adjusted deliverable feeder cattle prices are displayed in the third chart along with the November contract close on 7/27/2023.

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