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Risk management key as cattle market volatility continues

An ag economist says the volatility in the cattle markets is expected to continue.

Josh Maples is with Mississippi State University Extension.  “This market is not someone out there pulling a lever saying ‘ope, bad news today, we’re going to push prices down or good news today we’re going to push prices up’,” he says.  “The market is a reflection of real positions that people are taking.  They’re reacting to the information that comes out.”

He tells Brownfield the continued threat of New World screwworm has influenced how the market has moved.  “On one hand, people are going to see this and maybe it is going to be negative for the market because we’re worried about it being so close to the U.S.,” he says.  “So it could lead to some traders to be a bit bearish.”

And, he says rumors play another factor in the volatility.  “It shows the complexity of these markets,” he says.  “It really is about the news that comes around and how it affects the particular traders.  And people take different positions based on the exact same information.”

Maples says it’s a good reminder for producers to implement solid risk management plans for their operations.