Latest / Professional Ag Marketing Podcast / Cash Confirms the Cattle Rally | Cattle Market Talk April 2nd, 2026

Transcript

Cash Confirms the Cattle Rally | Cattle Market Talk April 2nd, 2026 · Professional Ag Marketing Podcast

• 0:02
  SPEAKER_00: Welcome to the Cattle Talk Podcast.
• 0:06
  SPEAKER_00: Your weekly breakdown of cattle market fundamentals, key news, and the insights shaping the industry.
• 0:12
  SPEAKER_00: Trading commodity futures and options involves substantial risk of luck and is not suitable for all investors.
• 0:22
  SPEAKER_02: Today is April 2nd.
• 0:23
  SPEAKER_02: It is a one-year anniversary, Jace, to Liberation Day.
• 0:27
  SPEAKER_02: Absolutely.
• 0:28
  SPEAKER_01: How are you feeling liberated today, sir?
• 0:30
  SPEAKER_01: I I think I'm feeling a little better than where we were last year at this time, but it was a day last year.
• 0:37
  SPEAKER_02: A lot of you folks, if you're uh just tuning in for the first time to professional egg marketing or don't talk to us a whole lot, last year was a very interesting day in the marketplace for many of us as we awaited Trump's game show.
• 0:49
  SPEAKER_02: Many of us could probably suggest it as he brought up a board with a country list and tariff list.
• 0:54
  SPEAKER_02: It was quite the event to watch, especially on our side, watching the markets alongside of it.
• 0:59
  SPEAKER_02: It was a very interesting month last April to say the least, Jace.
• 1:03
  SPEAKER_02: It absolutely was.
• 1:05
  SPEAKER_02: Today we're gonna talk about the cattle market, another very interesting market as well.
• 1:09
  SPEAKER_02: Uh this week we've seen some massive rallies across the futures and the cash side of things.
• 1:14
  SPEAKER_02: I just want to bring up uh, Cade, bring up uh the June chart on fat cattle there.
• 1:19
  SPEAKER_02: I just want to talk about this incredible spike higher we've had.
• 1:22
  SPEAKER_02: We've got some moving averages on the page, 10, 20, 100, and 200 day moving averages floating well and separating itself uh from those immensely here.
• 1:33
  SPEAKER_02: Uh six straight days of an upward movement across most of the futures months.
• 1:37
  SPEAKER_02: What do you got to say about this rally and kind of what's been kicking us off here the last week or so?
• 1:43
  SPEAKER_01: Yeah, it's been huge.
• 1:44
  SPEAKER_01: So we we started the week below that gap near the top.
• 1:49
  SPEAKER_01: So the gap was created on October 16th there, and then we gapped lower and went went lower because of Trump, you know, kind of targeting the beef, high-priced beef, and then we had a had a few things that really shook up the market last fall and took it way lower, and we've been on a grind higher since then, kind of plateaued in February, April, or March.
• 2:11
  SPEAKER_01: We were kind of flat to lower, and then we just took off here this last week and on a on a few different things.
• 2:19
  SPEAKER_02: I would guess the month of February was really surprising to me because as you look at this chart, when I looked back and we started to retrace when we started to rally in December there, I was like, okay, oh, let's get a picture perfect textbook scenario, 50, 61% retracement.
• 2:35
  SPEAKER_02: You know, we're not gonna get anywhere close to that old high.
• 2:38
  SPEAKER_02: And we've now put a new highs.
• 2:40
  SPEAKER_02: It this is an incredible rally versus what I thought this markup was gonna be capable of, Jace, especially in the phase of the cycle, how long this rally's been lasting.
• 2:49
  SPEAKER_02: We've recouped so much of this and then some.
• 2:52
  SPEAKER_02: I'm just surprised.
• 2:53
  SPEAKER_01: Yeah, it was was a huge rally, and like you said, we were looking at retracements that whole time.
• 2:59
  SPEAKER_01: It was never it was never really a discussion of new highs again.
• 3:03
  SPEAKER_01: You know, that was obviously in the back of our minds, but now getting into the January report didn't show much heifer retention.
• 3:12
  SPEAKER_01: So that kind of kept us going a little bit there, and then since then we've just been picked up by stronger meat, stronger cash.
• 3:21
  SPEAKER_01: It's just been a it's been a pretty bullish story.
• 3:23
  SPEAKER_02: Over the years, I I remember there was some study that I I uh was involved in where we talked about the correlation between what makes cattle prices what they are, right?
• 3:33
  SPEAKER_02: And there was like a 93% correlation between supply and price.
• 3:38
  SPEAKER_02: And today we still don't have the cattle numbers, do we?
• 3:41
  SPEAKER_01: We don't.
• 3:41
  SPEAKER_01: We don't, and we have really good demand.
• 3:44
  SPEAKER_02: So on that front, what does the cash market show us here this week?
• 3:48
  SPEAKER_01: So cash last week was 238 towards the top end.
• 3:53
  SPEAKER_01: There was a lot of trade at 236, 237.
• 3:56
  SPEAKER_01: Um that would have been a couple bucks more than the week prior.
• 3:59
  SPEAKER_01: Yep, yep.
• 3:59
  SPEAKER_01: Yep, that would have been a little stronger, but mainly Friday afternoon, right?
• 4:03
  SPEAKER_01: Mainly Friday afternoon, and nothing, nothing too nobody was too excited about that.
• 4:07
  SPEAKER_01: And even heading into this week, we didn't know what we were gonna find.
• 4:11
  SPEAKER_01: You know, Greeley's still on strike.
• 4:13
  SPEAKER_01: We still don't know, didn't know what we had for leverage, and then and then today came along.
• 4:18
  SPEAKER_02: Yeah, no kidding.
• 4:19
  SPEAKER_02: So today's cash news.
• 4:21
  SPEAKER_02: Uh someone must have seen this coming through this week with the massive rally in futures we had, but 246 so far, I think, has been paid here this afternoon.
• 4:30
  SPEAKER_01: Yeah, it started out at like 243, um, and it's just been climbing since then.
• 4:36
  SPEAKER_01: Some guys in the south have passed 246, but there have been a lot of cattle traded at 246.
• 4:42
  SPEAKER_02: One of the other reasons I think the Packers may be able to be a little bit more flexible on this, futures going up, maybe pushing cash along side of this.
• 4:50
  SPEAKER_02: The Packers are probably going long with it because their margins have improved a little bit recently, haven't they, Jace?
• 4:55
  SPEAKER_02: Yeah, they have.
• 4:56
  SPEAKER_01: So if we look at beef cutout, the the choice last year ran elevated to the years prior by quite a bit, the whole year.
• 5:05
  SPEAKER_01: And we saw seasonal rallies, like it was just it was just a seasonal market from an elevated level.
• 5:12
  SPEAKER_01: And what we're seeing this year is just another step higher.
• 5:16
  SPEAKER_01: Like we've got and then some, and then some, but we've got we've got cut out, got above 400 there on the choice, and we've taken a little bit off of it, but we kind of did the same thing last year.
• 5:28
  SPEAKER_01: Early April, we took a little bit off of the off of the boxes there, but very, very elevated level, and they've built themselves some cushion, you know.
• 5:37
  SPEAKER_01: Like if you look at what they're paying on the on the meat side, even today, they're paying$385 to$390 on the b on the on the dress side for cash, and they're selling the meat out the door in the mid 390s.
• 5:51
  SPEAKER_01: So it's still, you know, that that's getting that's getting significantly tighter, but they have been making money for the past few weeks.
• 5:58
  SPEAKER_02: Kate, do you want to pull up the Packer margin graph there on the next slide?
• 6:02
  SPEAKER_02: I believe that that helps tell a fantastic story, just that it surprises me a little bit that we've been able to do this because I I sure thought, especially after the JBS situation, I thought the Packer had all the leverage, and maybe they still do.
• 6:17
  SPEAKER_02: But nonetheless, now that they've got a little bit more flexibility, they're willing to share on this rally higher, aren't they, Jace?
• 6:23
  SPEAKER_01: Right.
• 6:24
  SPEAKER_01: And they they have increased kills over the past couple weeks here now, compared to what they they were really, really low.
• 6:32
  SPEAKER_01: And and that was at the start of the Greeley strike and all of that.
• 6:36
  SPEAKER_01: But since then, we've seen them start to pick up a little bit.
• 6:40
  SPEAKER_01: They want a little bigger share in this in this profit margin.
• 6:44
  SPEAKER_01: And I think it's I think they're kind of wouldn't say giving it away, but they're they're willing to they're willing to lose a little bit of their leverage to participate in this.
• 6:54
  SPEAKER_02: It's odd holiday week here.
• 6:56
  SPEAKER_02: Uh how are you expecting this week's harvest to look going into the weekend here?
• 7:00
  SPEAKER_01: Yeah, I think we'll we'll obviously be shorter than we were than we are on a normal week, but I wouldn't I wouldn't be I wouldn't be too surprised if we if we were, I don't know, 50,000 less.
• 7:12
  SPEAKER_02: The last few holidays I feel like we had, the Packers were in a situation where when the holiday came around, they're like, thank goodness I can shut down for a few days here and not have to worry about it.
• 7:21
  SPEAKER_02: This time around, not so much the case, is it?
• 7:23
  SPEAKER_01: Yeah, it's a it's a totally different position when they're making money.
• 7:27
  SPEAKER_02: So the outside markets obviously could be playing a part in this recent rally that we've had as well.
• 7:33
  SPEAKER_02: Donald Trump last night made an announcement at 8 o'clock Central Time last night that has massive market implications.
• 7:42
  SPEAKER_02: Uh when he came out, the SP dropped really hard last night, down 100 points.
• 7:47
  SPEAKER_02: That moved the cattle futures lower at the start of the day, but couldn't hold on to it.
• 7:52
  SPEAKER_02: Too strong cash, and the SP bounced all the way back today.
• 7:55
  SPEAKER_02: Kurdoil held its head up high uh up massively in the front month.
• 8:00
  SPEAKER_02: Um this Iran conflict is still impacting our markets today.
• 8:05
  SPEAKER_02: Uh the equities continue their slide off, mainly just in a risk off.
• 8:09
  SPEAKER_02: Meg 7 taking a lot of the brute force on that guy.
• 8:13
  SPEAKER_02: There's no major cracks or ripples in this economy at this point.
• 8:17
  SPEAKER_02: Low unemployment, GDP is going up.
• 8:20
  SPEAKER_02: Um even massive money flow into the bond market seems nonexistent.
• 8:25
  SPEAKER_02: Uh we're seeing some increased, but nothing alarming.
• 8:28
  SPEAKER_02: Um at this point, Jace, the outside market is having an effect on the live cattle market, but I thought it participated pretty well this week in light of some uh vulnerabilities, I feel like, in those outside markets.
• 8:42
  SPEAKER_01: Yeah, it absolutely did.
• 8:43
  SPEAKER_01: And like the run-up, the run-up last fall was along with an SP that was headed higher.
• 8:48
  SPEAKER_01: And I mean, it was it was just a perfect storm then, and now you would say it's driven almost entirely by fundamentals.
• 8:56
  SPEAKER_01: The cattle market.
• 8:57
  SPEAKER_02: The cattle market.
• 8:58
  SPEAKER_02: Speaking of that, what we'll wrap up with one last question here.
• 9:02
  SPEAKER_02: On the weather front, a lot of talk about what Nebraska's got going on right now in the cattle country.
• 9:08
  SPEAKER_02: Uh, the southern United States has been pretty dry.
• 9:12
  SPEAKER_02: Uh, Nebraska and Kansas missed out on some rains probably here in this little front.
• 9:16
  SPEAKER_02: What can you tell me about the weather situation and how that's impacting the cattle market?
• 9:21
  SPEAKER_01: Yeah, so I think especially in the south, like we've seen wheat prices dropping here.
• 9:26
  SPEAKER_01: Um, they're getting rains where they need it for the for the winter grazing.
• 9:31
  SPEAKER_01: So, Texas, Oklahoma, they're getting some rains now.
• 9:35
  SPEAKER_01: They think they'll be able to keep calves on wheat a little longer and on already short sale numbers on the feeder cattle side, that's getting tighter.
• 9:43
  SPEAKER_01: So I we're seeing the index rally here, and I think that'll continue.
• 9:49
  SPEAKER_01: All right.
• 9:49
  SPEAKER_01: Well, thank you for joining us here today.
• 9:52
  SPEAKER_02: Thanks for tuning in.
• 9:53
  SPEAKER_02: Uh, reminder click the link in the description to sign up for our daily market commentary, get fast insights into the egg markets and so much more.
• 10:00
  SPEAKER_02: Also, check out our website at professional eggmarketing.com.
• 10:04
  SPEAKER_02: Thanks, guys.