Cattle Call is an original production of the Nebraska Rural Radio Association and presented by Blue Chip Herefords – Oxford, Nebraska.
A volatile cattle market is being driven as much by global trade policy as domestic supply, according to market analyst Brad Kooima, who says uncertainty surrounding Brazilian beef imports and China trade negotiations helped spark last week’s futures selloff before cash cattle prices roared higher again.
Speaking this week, Kooima said rumors the Trump administration could relax tariff-rate quotas on Brazilian beef imports rattled futures traders even as negotiated cash cattle prices continued climbing to historic levels.
“Cash proved itself once again last week and again yesterday,” Kooima said. “We’re being part of history here. Never had a cash market this high before.”
Kooima pointed to reports that the administration was considering changes to the current quota system governing Brazilian beef imports. Beef imported beyond the quota currently faces a 26.4% tariff.
“The market quickly jumped to the conclusion that this was going to end up in a change in policy,” he said. “The worry was that we were gonna come out of that with … dropping the quota system altogether.”
While the administration later clarified no immediate policy changes were planned, Kooima said the uncertainty exposed how sensitive cattle futures remain to geopolitical headlines and algorithmic trading.
“You chase the long speculator,” he said. “From a futures standpoint, that’s what I worry about — that he loses confidence in the uncertainty and he gets tired, beat up.”
At the same time, Kooima said traders are closely watching ongoing negotiations with China, including reports that Chinese officials may renew export licenses for hundreds of U.S. beef plants.
“I think President Trump recognizes that he certainly absolutely needs to have some sort of a win for agriculture,” Kooima said. “That’s why I wonder … do those two stories fit together?”
Despite the volatility in futures, Kooima said fundamentals in the cash market remain exceptionally strong, with feedyards maintaining leverage over packers amid tight cattle supplies.
“We had cattle yesterday that got sold for the week of June 12 for $265, almost a month out,” he said. “If you’re a packer, and if you think you’ve got any chance of buying those cattle cheaper, you don’t go a month out.”
Even so, Kooima warned that soaring beef prices and rising fuel costs could begin testing consumers, particularly as summer travel season ramps up. He added that restaurant demand may already be softening as consumers adjust spending habits.
Still, Kooima said the broader cattle market remains supported by tight supplies and aggressive competition for available cattle.
“When you’re talking about a market, you can take it down to one word — and it’s leverage,” he said. “There’s not enough to go around until somebody slows it way down.”