MARKETING

By Bryce Myrick
Director, TFB Agricultural Marketing Education

Is the outlook for a weak year-end economy already effecting commodity prices? Two of the agriculture commodities that would be most affected by a Fall recession are cattle and cotton. Both may already be showing signs of an anticipated weaker economy.

A Spring rally in grains seems to be the consensus of Chicago grain traders. This may give producers an opportunity to market this year's grain before a harvest pull back in prices. Without a Spring rally in cotton, where will prices be at stripping? Will live cattle prices be able to increase after our summer low?

During a recession, consumers will cut back on clothing and beef consumption. With December cotton futures trading at 58.60 and December live cattle at 74.65, we are in questionable times. OR ARE WE ARE IN A SLUMP? Both U.S. cotton mill use and export estimates were lowered this month. U.S. mill consumption of cotton is projected at its lowest level since 1991/92. If cotton and cattle give us an opportunity at higher prices, maybe we should consider hedging.

To set up workshops or for help with your hedging needs, call 254-751-2242 or 915-698-0355 or e-mail: bbmyrick@swconnect.com.

December - Cotton

October - Live Cattle

December - Corn

Fundamentals: Good exports—Higher production cost
Technical Analysis: Trend—Down; Resistance—2.60; Support —2.44

July - Soybeans