Will Long Liquidation Continue in Cattle?
Outside markets are “risk-off” again in the early morning trade following retaliatory tariffs from China. Will that prompt more long liquidation in cattle in Friday’s Trade?
Live Cattle (June)June live cattle futures opened lower yesterday but held together fairly well considering the precipitous decline in the outside markets. Outside markets are sharply lower again in the early morning trade following retaliatory tariffs from China. The VIX (volatility index) was rather subdued yesterday despite the risk-off trade, that index is spiking in a more meaningful manner which is more indicative of panic (potentially getting closer to peak panic). With the probability of a recession continuing to increase this week, we see that as a significant headwind for cattle, especially with the way Funds are positioned. High prices over the last year have been unable to really dent demand, but high prices coupled with a potential weaker consumer is the concern now.
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Daily Cattle and Beef Summary Cutout values got hit on Thursday afternoon with choice cuts 1.53 lower to 338.37 and select cuts .99 lower to 317.84. Thursday’s slaughter was reported at 121k head. The 5-area average price for live steers was reported at 210.00, on light volume. The CME feeder Cattle Index is at 291.93 with the NBW Real-Time Index showing 290.46 as of this morning. |
Seasonal Tendency Update (updated 3.31.25) Below is a look at historical price averages for June futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results). |
Commitment of Traders Report
Friday’s Commitment of Traders report showed Funds were net buyers of roughly 3k futures/options contracts, which expands the net long to a new record, 34,132 futures and options contracts.
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