CattleFax Predicts Market Shock Is Nearly Over, Turbulence Still Ahead

IMG_3814Recent price shock in the market and insights about the turbulence ahead were explained today to more than 2,000 beef producers at the CattleFax Outlook Session held during the 2016 Cattle Industry Convention and NCBA Trade Show.

The downward spiral in price from record high cattle prices has been a rough ride for many in the business, but CattleFax CEO Randy Blach said the market correction has mostly occurred.  He explained how tight global protein supplies and a strong export market in 2014 and 2015 led to the ‘perfect storm’ of market peaks and significant drops seen in recent extremes. Animal health challenges in both poultry and pork production led to tight supplies in 2014, which saw the tightest per capita protein supply in the last 20 years.

“We are coming off of historic peaks in the cattle market, created by unique conditions in the global beef and protein markets,” said Blach. “Dynamics, specifically global beef supply, led to a large correction in price. That big market downward swing is nearly over now. However, the cycle shows prices continuing to trend lower in 2016, 2017 and 2018.”

Analysts predicted the cattle feeder will lose about $200 per head, stocker operators with tight margins, and cow/calf with profitable margins. The team of economists expect fed cattle prices averaging $130 to $145 over the next year.

“The cow/calf margins will still be profitable, but substantially lower than in the past two years,” said Kevin Good, Senior Analyst and Fed Cattle Market Specialist, CattleFax. “We predict the cattle feeder will have tight margins for the year overall with potential for profit mid-year.”

A two-year El Nino weather pattern has replenished moisture conditions across the country, specifically the West coast, which saw some relief in 2015.  The weather outlook appears favorable, especially moisture conditions for grasslands, according to the weather outlook from Art Douglas, Ph.D., Professor Emeritus at Creighton University.

“As we head into 2016, a split jet stream pattern will favor above-normal precipitation from California to the Southern Plains and the Southeast through March,” said Douglas. “In the Corn Belt, spring will be wetter-than-normal which will be accompanied by slower spring warming. Delays in fieldwork and planting dates are likely to result.”

Analysts predicted $294 added value per head in exports for the year ahead, a $66 drop per head from 2014 values. This decrease in export potential is caused by a combination of a strong U.S. dollar, slowdown in global market and challenges with market access. Russia and China are still the biggest opportunities for U.S. beef but trade restrictions will continue to limit potential in the year ahead.

Imports of beef are predicted to be down 8 percent since domestic cow kill will increase. In recent years the United States was in a rebuilding stage and females were held back for the cow herd. Imports of slaughter cows from Australia were available because of drought, but improving moisture conditions in 2016 will keep females in Australia for herd rebuilding. Analysts predict the U.S. cowherd growth will see slowed growth in the coming year and predict a 600,000 head cowherd increase, which is down from a 1.1 million increase in 2015.

To learn more from the CattleFax Outlook Session or become a member, visit http://www.cattlefax.com

Advertisements

American Angus Auxiliary To Host Women Connected

Young woman is walking around a ranch with cattle in the distance

The American Angus Auxiliary invites women from across the Angus industry and agriculture business to participate in its third Women Connected Conference April 2-4 at the Certified Angus Beef LLC (CAB) Education and Culinary Center in Wooster, Ohio.

The theme of this year’s conference is “Branding,” and attendees will participate in a variety of activities, workshops and tours that will connect them with the CAB brand, while exploring ways to build a personal brand for themselves and their businesses.

The conference, hosted every other year, is open to 20 participants, and the Angus Foundation sponsors all accommodations and meals for the three-day event. Attendees need only provide their own means of transportation to and from the event. Applications to attend Women Connected are due Feb. 15.

“We’re very excited that the Angus Foundation has approved funding for us to have the conference again this year,” said Shally Rogen, American Angus Auxiliary president. “It’s a great opportunity to come and learn more about the Certified Angus Beef® brand, and a little about the Auxiliary and leadership, as well.”

Rogen, the newly elected president and native of Brandon, S.D., said the conference offers many advantages for women interested in attending.

“It’s a great opportunity for fellowship and for women to learn how they can promote the Angus breed in their own communities, and become more educated with what’s going on at the national level,” Rogen said.

To download an application or to find more information on the Women Connected conference, visit www.angusauxiliary.com, or contact conference chairman Anne Lampe at alampe@wbsnet.org or 620-874-4273.

Conference participants will be responsible for transportation to and from the Cleveland-Hopkins International Airport if flying, and Wooster, Ohio, if driving.

Lampe stressed that the conference is not only for members of the Auxiliary. An interest in Angus cattle is the only prerequisite, she said.

“The conference is about bringing women together from all backgrounds that share the common bond — a love for Angus cattle,” Lampe said. “We strive to engage, educate and empower.”

2016 Women Connected Schedule of Events:

Saturday, April 2

3 p.m.-5 p.m. – Registration, hotel check-in — Hampton Inn, Wooster, Ohio

6:30 p.m.Gathering followed by Welcome, Opening Session, Dinner — Entertainment by Cara Bout Ag, Cara Pascalar Ayers

Sunday, April 3

Workshops and education at the CAB Education and Culinary Center along with tour of local area.

Monday, April 4

Tour CAB headquarters, participate in Connecting with the Brand, breakout sessions, meet staff.

1 p.m. — Depart for home.