The cattle market collapse began in the slaughter cattle markets and the wholesale boxed beef prices and spread into the yearling and stocker markets from the latter part of August, through September and into the early days of October. The live cattle and feeder cattle futures plunged faster than the cash markets, resulting in the live trades chasing the futures even lower.
That all began to change about a week ago as the futures changed course and staged a big rally. The limited cash cattle trade in the Texas and Oklahoma Panhandle as reported by the Texas Cattle Feeders Asssociation was significantly higher this past Friday compared to a week earlier- and the major auction markets in Oklahoma- the Oklahoma National Stockyards and OKC West in El Reno had big rallies in their yearling and calf trade in their most recent sales.
The plunge and now the retracing of the cash markets back up to some degree has a great deal to do with the currentness of the cattle ready for slaughter. According to OSU Livestock Market Economist Dr. Derrell Peel, the feedlots and packers pulled the overall cattle market over the proverbial cliff because of beef industry carcasses that were too heavy and resulted in too much tonnage- and that killed the slaughter cattle market, forced live cattle and feeder cattle futures to plummet and resulted in multiple weeks where we saw yearling and calf prices drop double digits.
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