Stagflation, inflation, rising food costs…these are all factors that are creating murky waters in front of beef demand, if you look at the rest of the 2022 calendar year.
Anne Wasko of the Gateway Livestock Exchange says in our latest Beef Market Update, that even if you look at live cattle futures, and live cattle contracts into 2023 — they’ve certainly lost big ground over the last two months.
“I think the worries around demand are driving a lot of that,” she explains.
Last week in the U.S. we saw a cattle on feed report for May 1, and it was up 2 per cent, which is a record large on feed supply.
“We can’t kid ourselves. This isn’t a surprise in terms of the big numbers we still have on feed. We are pretty sure this fed cattle market in the U.S. is still going to trend lower into the summer as it typically does,” says Wasko. “And that supply picture would confirm or verify that thought basis.”
As we go further on into 2022 and 2023, the supply piece does get more friendly, but as Wasko says, the concern is starting to be around the demand piece.
“Father’s Day is kind of the last of the big three if you will, and then you get more into those dog days of summer. It gets hot, and folks are looking for the hamburger and hot dog kind of flip, versus the top end cuts,” she says.
Check out the full conversation with RealAg Radio host Shaun Haney and Anne Wasko, below: