“Shootin’ The Bull”

by Christopher B Swift

​12/15/2025

Live Cattle:

Basis is even in the fats out to April.  February through April will produce the most expensive fat cattle so far.  Cattle prices have to go up significantly to return input costs. Projected losses on newly placed inventory continues to be deep in the red.  Cattle feeders are continuing to bid higher for incoming inventory, at a time when even fewer cattle are anticipated available, and woefully too much production capacity. I don't know if any of the above factors will cause beef or cattle prices to go higher or lower.  What I do know is that cattle prices do have to climb higher to return inputs, and if they do not, the losses may or may not be staggering.  You are already participating in one of the most volatile and price expansive markets for 2025, leading me to believe management of this situation to be crucial. 

  

Feeder Cattle:

Futures traders continue to lag behind the cash, with seemingly little expectations of pushing futures to an even basis. In my minds eye, if there were not going to be any more cattle this spring, and just as many producers, why are producers not buying the huge discounts of the spring months?  In my opinion, futures should be premium by tens of dollars if there are going to be even fewer cattle and the same number of producers.  However, they are not premium and cattle feeders and futures traders are not seemingly anxious to own cheaper cattle this spring than at present. A lull in time is upon us where the next two weeks will be greatly abbreviated. With recommendations having been made, the wait and see mentality remains.    ​

 

​Corn:

​All were lower.  Beans are in a down trend with March having come to within three quarters of a cent at filling the gap.  Corn traded back under the up trend line. There is little hope for China to pull the US out of a bean and corn glut.  Biofuels are a means for which to encourage corn and soybean usage domestically, but still can't seem to get all the ducks in a row to make a meaningful impact on disappearance. Although corrective rallies are anticipated, I continue to anticipate soybeans to trade under $10.00 and corn to a new contract low.  

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Energy:​

​Energy is lower. Crude is resuming a down trend.  Diesel fuel and gasoline have reversed and are trading lower. Diesel fuel is only about $.04 from the low it made prior to the November high. Lower energy and stimulating the economy are going in different directions. 

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Bonds:

​Bonds are higher, but not by much.  The sell off after the rate hike leads me to believe lower is the direction for bond prices. With the administrations actions to keep stimulus going, and clearly not wanting to see equities fall back, it will be more than interesting to watch if current actions do progress the economy further, or potentially expose weakness not seen or further divide between the two economies.  For the moment, I continue to anticipate bonds to trade lower.   

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​​​​​​ “This is intended to be or is in the nature of a solicitation.”  Futures trading is not for everyone. The risk of loss in trading futures can be substantial; therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Past performance is not indicative of future results, and there is no assurance that your trading experience will be similar to the past performance.

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