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An explainer on feeder cattle basis notes that cash-to-futures differences vary with location, weight, local conditions and timing. Weak basis in Mississippi reflects distance from feeders, seasonal supply peaks and Southeast drought, while Oklahoma's basis is stronger due to nearby feedlots and winter wheat pasture.
Regional basis weakness signals lower local cash feeder prices and less feed demand in the affected areas. Drought-driven grass shortages in the Southeast can push more cattle to market and pressure prices.
agproud.comBrian R. WilliamsNov 15, 2016Not enough comparable past events yet for a historical read.
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.
