Some are saying this is the most volatile cattle market ever, but an evaluation of that statement would take considerable number crunching.
There is worry that more hogs are headed to market this fall than available packing capacity, and the latest USDA inventory indicates there are more hogs than had been anticipated.
Producers of beef and pork have generally been discouraged about recent low prices as cash prices have dropped sharply this year. Spring finished cattle price highs were near $138 per live hundredweight but last week had fallen to $115, a $23 plunge.
Beef supply has been large due to heavy placements of heavy calves and the beginning of more females coming to market as herd expansion may be slowing.
In the June Hogs and Pigs survey, pork producers told USDA they had increased the size of the breeding herd by 1% relative to year-ago levels.
Higher feed prices are once again the main story when it comes to reducing prospects for profitability in pork production. Will higher feed prices erase hog profits?
Cattle prices have had a rough spring. After peaking in late 2014 and early 2015, prices have been adjusting downward from very lofty peaks.
Pork producers are reducing farrowings in 2016. That means pork supplies will be somewhat less than had been anticipated and that hog prices will be somewhat higher.
The outlook for the pork industry has turned somewhat more optimistic in recent weeks. The sources of that optimism include a $2-$4 increase in spring and summer lean hog futures prices since the first of the year and slightly lower new-crop soybean meal p
Nothing like record cattle prices and profitability to get an industry excited about expansion. The latest USDA Cattle report shows a rapid expansion is underway with cattle and calf numbers up 3% and beef cow numbers up 4% in the past year.