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COVID-19 uncertainty and rapid financial market swings have hit the beef cattle sector, with live cattle contracts losing about 25 percent of their value between mid-January and late March. Panic buying has drained supply chains and created a false sense of increased demand, according to University of Arkansas extension experts.
Cattle futures have been tracking broader financial market losses rather than fundamentals, so feeder and fed cattle prices are exposed to macro sell-offs. Feed buyers should expect continued price volatility while demand signals remain distorted.
uaex.uada.eduMar 31, 2020After 37 past bearish macro events, Live Cattle moved a median -1.1% over 5 sessions (30% higher; middle half -4.3% to +0.4%), and -0.4% over 20.
After 27 past bearish macro events, Feeder Cattle moved a median -0.9% over 5 sessions (37% higher; middle half -3.7% to +0.4%), and 0.0% 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.
