Livestock traders are paying attention to President Donald Trump’s vow to tackle high beef prices, sending futures for feeder cattle tumbling the most in four years.
Futures for feeder cattle in Chicago dived by as much as 4.1% Tuesday after Trump reiterated a call to bring prices down. “The ranchers for 35 years have done very poorly,” he told reporters. “Now they are doing well, but the price is up.”
The president’s plans to provide relief to consumers include importing more beef from Argentina. Cattle futures are also being pressured by talks with Mexico over resuming imports into the U.S., as well as negotiations with Brazil to reduce duties on beef and other goods such as coffee. Taken together, investors who had been bullish on cattle have been getting out.
“The smaller feeder market has been overwhelmed with aggressive selling,” Hightower Report said in a Tuesday note.
Futures for feeder cattle, which reflect the younger animals moving off ranches and into feedlots for fattening, have slumped for five straight days from a record earlier this month, to the lowest level since July.
However, wholesale beef costs at wholesale are still firm. Retail prices for ground beef in August were a record of more than $6 a pound.
Trump’s efforts on beef have met with some fierce criticism from ranchers — a sector that has largely backed the president. After he announced plans to import more beef from Argentina, the National Cattlemen’s Beef Association said any increased imports would undercut US producers. The administration has worked to placate ranchers with a program to boost domestic beef production that includes more federal grazing.
Trump has pointed to falling egg prices as a success he wants to replicate in meat. “We are going to get the price of beef down, and I will make sure the ranchers don’t get hurt,” he said.
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