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Cattle futures and cash markets fell sharply last week on coronavirus fears affecting global trade. The February live cattle contract lost $6 and feeder futures fell below $130, while cash cattle sold $5-6 lower.
Managed money rushed to build short positions.
Fear-driven selling and fund shorting pressure cattle and feeder prices, and fears about trade disruption weigh on the feed chain.
wlj.netPete Crow, WLJ publisher emeritusMar 2, 2020After 70 past bearish disease events, Live Cattle moved a median +0.0% over 5 sessions (51% higher; middle half -1.7% to +1.0%), and +0.4% over 20.
After 46 past bearish disease events, Feeder Cattle moved a median +0.3% over 5 sessions (54% higher; middle half -2.3% to +1.6%), and +1.8% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Week-ending coverage of live cattle falling sharply on coronavirus trade fears with cash $5-6 lower and managed money building shorts directly explains the 5-day drop.
