Call the Market               07/15 04:58

   3 Thoughts for Cattlemen to Ponder as the Market Softens

   It's yet to be seen if the recent softness in the cattle complex is a 
seasonal decline or if the market is trying to signal something greater to us. 
Either way, the recent turn of events makes one ponder a couple of thoughts.

ShayLe Stewart
DTN Livestock Analyst

   Oversimplifying the market's dynamic ebbs and flows can be misleading, but 
given that it is the middle of July, it seems almost predictable that the 
market would waver and show some softness following its recent springtime high.

   But as always, like I said, it can be dangerous to oversimplify the market's 
behavior, as a critical eye can only catch what it's actively looking for. So, 
I think it's time to ask ourselves: What's the market trying to tell us right 
now? Is this a blip in the cattle market's rally that will later be chalked up 
to nothing more than a seasonal decline? Or is something larger at play here, 
slowly demanding our attention one day and lower close at a time?

   Right before the Fourth of July holiday, both the live cattle and feeder 
cattle contracts began to trade lower as fatigue seemed to settle into the 
futures market. With boxed beef prices waning and fed cash cattle prices 
softening simultaneously, the contracts have traded lower ever since.

   I personally sit in the camp that believes this is a seasonal downturn and 
that support and stability will be found again in the coming weeks and months. 
What I can't confidently tell you is whether the high of this cycle has been 
made yet. It seems almost drunken to think that prices could outdo what we saw 
this spring -- but if you think back to 2025 and the prices that the market 
accomplished then, we said the same thing.

   But when I turn off my computer at the end of the day, the market's turn of 
events has pressed my mind to consider a couple of things.

   First, if I was a producer who hadn't marketed their calves yet, I would be 
thinking heavily about what my marketing strategy was going to be. What we've 
seen thus far from the video sales offered this late spring and early summer 
has been nothing short of incredible. A month ago at Superior's Corn Belt 
Classic, seeing feeder steers sell anywhere from $2,700 to $3,000 per head was 
the norm. The market's biggest year-over-year advancement was on those weighing 
500 to 540 pounds, which traded $158.47/cwt more than last year's prices and 
averaged $557.25/cwt. The narrowest year-over-year advancement was seen on the 
heavier weighted steers weighing 750 to 790 pounds, which saw a $88.75/cwt 
advancement compared to last year's prices and averaged $417.00/cwt. Like I 
said, the prices were almost unbelievable, and even though prices have softened 
slightly in recent weeks, this market is still red hot.

   Secondly, if this isn't a mid-summer blip, and we have seen the highs of 
this cycle, does that change anything for your operation moving forward? Does 
it change anything in the next month, three months, six months or year from now?

   And last, but certainly not least, I recently listened to a podcast by 
Ranchonomics, hosted by John Haskell with Ranch Right, where he spoke in great 
detail about the difference between market inflation and true asset 
appreciation. If the market has reached its peak for this cycle, have we done 
all that we can do to add as much appreciation to the commodity we hold? And 
have we set our business up to weather the downturn?

   You can access the podcast mentioned above here: 
https://podcasts.apple.com/us/podcast/91-the-hidden-risk-inside-todays-record-ca
ttle-prices/id1756974293?i=1000758390471.

   Truth be told, none of us know what's coming down the pike in the next 
month, three months or a year from now. All we can do is take the assets we 
have and best position them for whatever trials lie ahead, while staying active 
and diligent in the fight for profitability.

   ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com




(c) Copyright 2026 DTN, LLC. All rights reserved.