Shootin' the Bull about doing whatever it takes

“Shootin’ The Bull”

by Christopher B Swift

5/08/2026

Live Cattle:

In my opinion, further division between cattle and beef is being seen.  Cattlemen continue to bid whatever price necessary to bring inventory home. That appears the simplest part of the equation.  Consumers are being impacted by the inflation with some of the potential job growth seen this week the cause for.  Although still a very short period of time in dealing with elevated fuel costs, these elevated fuel costs are on top of an already long-standing inflationary economy. Grocers and restaurants have shifted in multiple manners to retain customers and keep growth.  Beef has not been a part of this shift.  Packers continue to bleed profusely with this week's higher cash trade exposing further how much processing capacity there is. With each most likely under some form of contract for their beef, packers have to meet obligations, or else.  Cattle feeders seem to be the most concerned when dealing with cattle.  The slow placement agenda and not willing to bid feeder cattle to new highs, suggests they are on the forefront of attempting to ration cattle.  Not backgrounders though.  With no higher trade in feeder cattle, and dollars higher cash for lighter weights, continues to project deeper negative margins.  As thought, futures traders were not nearly as willing by weeks end to assume producers' risk at par or even close to.  Basis is anticipated to widen further, shifting more of the risk on to producers. 

Last week, and this, produced an exceptional increase of open interest. The new shorts are believed primarily to be producers, while the new longs may be questionable as to who they are. Most will think it is from commodity funds or packers.  I think it is from cattlemen in belief there is no top and the fat market easy to squeeze at this time.  We won't know until the next commitment of trader's report, but that is my guess.  Regardless of who it was, by Friday's close, few new longs were in any position to brag.  Producers had two excellent marketing opportunities over the past two weeks when futures traders were more willing to assume cattleman's risk at closer to par. I anticipate further widening of basis, in a positive manner, for which, if need be, futures could rally sharply to converge.  If there is no need, then cash will be thought trading lower.  All of the above remains void of everything else taking place at the same time.

Corn was higher on the week with the 5 handle being tested, but not secured as of yet.  I anticipate corn to trade higher.  Cattle feeders have been urged to consider what price they no longer wish to pay for corn and fix that price with call options in the December '26 and July '27 contract months. Wheat continues to trade higher and made a pretty good correction through this week.  Closing higher on the day, and well-off Thursday's low, it appears wheat is resuming its up trend.  Beans continue higher, as bean oil continues higher, due to energy trading higher.  The energy component of grains and oilseeds continues.  I don't expect that to taper off anytime soon.  The on again, off again military actions, or threats of, continues to produce massive volatility and price expanse, but no resolve.  Therefore, I anticipate more of the same.  Bonds ended the week higher, and I have no idea why, other than the President wants lower rates, to keep the economy moving, and pay a lower interest rate on the debt. 

​“This is intended to be or is in the nature of a solicitation.”  Futures trading is not for everyone. The risk of loss in trading futures can be substantial; therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Past performance is not indicative of future results, and there is no assurance that your trading experience will be similar to the past performance.