Shootin' the Bull about who gets to put on the pounds

“Shootin’ The Bull”

by Christopher B Swift

5/21/2026

Live Cattle:

The lower cash trade this week may simply wash out the lower price of the feeder when placed, leaving the cattle feeder with a breakeven this week.  Drought is an issue and changing the supply side of who gets to put the pounds on the cattle.  Moving them from one place to another does not reduce the number of cattle.  It simply suggests that some producers will not have an opportunity to put the pounds on the animal.  This appears as a next step to rationing.  The larger extent of rationing production capacity may come if found that risk management practices were not kept up with.  Basis is horrible and can get a lot worse.  If improves, could just as easily be from cash lower as futures higher. Traders left the market in droves on Wednesday with over 7,300 contracts having exited.  These were existing shorts and existing longs that exited the market.  

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Barring June, the remainder of this years contract months set new lows from contract high. A trade to the March low, per respective contract month, is anticipated. This would help to progress the Head & Shoulders pattern and maybe offer some insight into what may or may not be accomplished this summer in building the right shoulder.  Take a look at the highs for the left shoulder, where prices closed today, and then consider if a right shoulder does form, how much higher or lower will it be from the left shoulder?  Then consider, if I am wrong about this formation, how far down will it go? 

You are not out of choices, or are you too late to do something about it.  It is simply that the choices made now will have different circumstances than those made when it appeared more advantageous to market.  

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​​​​Feeder Cattle:

In the attempt to dig a Tiger trap, futures traders seemingly put a drunk in charge of the trackhoe this week.  Deep holes were dug and quickly filled in for most of this week.  Today though, it appears they kicked the drunk out and put someone else in charge. Limit down across the board is a rarity, even for this day and time.  Potentially, this may simply be the recognition that, even for as long as the supply issue has produced higher prices, it can't forever. With the congestion believed building from the center of the plate up, it is becoming more obvious that beef production and consumer demand has met a level of  equilibrium.  The drought will push more cattle into the feed yards, leaving fewer for backgrounders to tend.  So, this is not a reduction of inventory, it is a reduction of inventory to you, the backgrounder. 

In a baseball game, do you want to win the inning or the game?  You don't have to win all the innings' to win the game.  A comment to me this afternoon was great, and I appreciate all comments as they build my character.  It went like this: Comment to me was, "If you keep pounding a fastball down the middle, and give up 4 consecutive home runs, then finally strike someone out, is this considered a success?  My reply was: "Depends on if it was the game winning strike out." 

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​​​​Corn:

All were lower.  The significant influence of the energy market, computer programed trading commingled in multiple markets, and all hinging upon the next tweet by the President, leads me to believe grains and oilseeds will have a difficult time standing on their own fundamental merits.  This leads me to believe that the fledgling bull market in grains and oilseeds may stay that way until, or unless, markets can diverge themselves from energy and the President.  Of an unfortunate to farmers, the President has made it clear that energy prices will come down, way down, upon the termination of the military actions.  If so, with grains and oilseeds a component of energy, they could plummet along with energy. ​A disproportionate growing season may help to support prices, but they would have to be extreme to have grains and oilseeds divorce from energy.  On the flip side, with energy anticipated to continue higher, grains and oilseeds would be anticipated to move parallel with. There is no shortage of factors to contend with at the moment.  Farmers are urged to consider current price of new crop corn and beans and see how advantageous marketing a percent of would be.  Corn is not expected to stay around $5.00 for long, whether that means closer to $6.00 or $4.00. 

Energy:​

Another big trading range today with multiple trips back and forth.  Energy remains in a stout up trend.  I anticipate energy to continue higher.  ​

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Bonds:

Bonds flipped back and forth with the tweets today, as did the equities and energies.  China and Japan may just be holding off on more sales until the price moves a little higher.  A lot more government debt will be issued next week, so there is no slow down in government spending. I'm pretty sure the US debt in now well above 39 trillion this week.  As there are only three ways out of this mess, practice austerity, bankrupt, or print more money, the choice is clear to print more money. Just to show how old I am, when I made my first trade, bonds were trading around 80'00 and had rallied significantly from 55'00.  They are at 111'03 as I write this.  This suggests that these lows could be revisited again.   

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​​​​​​​​​​ “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.