Bulls, Bears, and Beef: Risk Management When Prices Run Hot
Cattle markets are at multi-decade highs, and producers are facing both incredible opportunities and serious risks. In this first radio edition of The Hedged Edge, hosts Jeff Eizenberg and Ben Hetzel dig into the realities of managing cattle risk when prices are running hot. Joining the conversation are Dwayne Bowman, President of Dakota Western Bank, and Joe McKitrick, a North Dakota rancher, who share their perspectives on: Why tight cattle supplies are driving record highs. The risks of inflation, feed costs, and consumer “trade-down.” How bankers and ranchers view tools like LRP, futures, options, and forward contracts. Opportunities in feed, ...
LEONARD LUMBER REPORT: You need to go back a year to find futures prices this low
The Lumber Market: You need to go back a year to find futures prices this low. That makes the next move either a return to previous lows or a bounce to a sustainable level. This isn't a 'could go lower' or 'could go higher' statement. It's a warning shot that the next lower targets are significantly lower if the reduced supply doesn't support prices. There remains a wall of concern about economic issues that could hurt housing in the future. I've been hoping for a lower supply for two years now to offset this, but nothing has changed. All the ...
LEONARD LUMBER REPORT: I have to start with the chart. It helps to clarify the argument that the mills’ added variable costs are of little relevance to the market
The Lumber Market: I have to start with the chart. It helps to clarify the argument that the mills' added variable costs are of little relevance to the market. That said, it did cause waves. The market bottomed in July of 2024 after Biden dropped out. It rallied up until the tariffs were put on hold, fell, and then rebounded into the duties. The argument today states that the flat demand warrants the market to test the low again. After Friday's disappointing trade, it could be possible. Outside influences have moved the market higher since July 2024. We could return ...
AG MARKET UPDATE: AUGUST 12 – 29
Corn has rallied off the post USDA report lows with a large up day on Friday to end the week. Pro Farmer Tour wrapped up their crop tour and has an average US corn yield of 182.7 bu/ac which would still be a record on top of the added acreage, but well below the 188.8 the USDA came out with. The two sides from the USDA’s report is that they likely won’t come out with a higher yield again with some small weather issues developing, but if they keep it high and make another big correction in January saying the ...
LEONARD LUMBER REPORT: The feature last week was the fact that the futures market made a new low at a time when there was a massive round of short covering
The Lumber Market: The feature last week was the fact that the futures market made a new low at a time when there was a massive round of short covering. That should have at least kept the market flat and at most rallied it sharply. By Thursday, the mills were in full panic mode and looking for orders. That brought in the noise of the week, with the conversation focused on a 15% tariff on Europe, 232, and a mill shutting down. By Friday, the industry saw a sharply lower print as the Fed, I mean Random, dealt with faulty ...
