Expanded limits, market volatility, and risk management

追加: 2026-06-03

[00:00:00]You mentioned those expanded limits.

[00:00:02]How much volatility and and does it add to the market when you're looking at it from your perspective?

[00:00:10]>> Well, you can trade those feeder cattle down there at nine and a quarter for one day. That's a lot, you know, taking an 800-lb steer $9.25, you know, that's $65 a head. It can happen in one day that they go down. As far as the market really following that, you know, we buy these cattle all the time. They're paying attention to the board. We just keep buying cattle.

[00:00:30]You know, we basically sold some cattle, made some money, so we're going to replace them and that just goes on and on and on. And then we got all this demand and you know all these corporates have to have cattle because they got some kind of deal made with the with the packer that they got to furnish them so many fat cattle every week or every month or however they do it. So, you know, they got to have the cattle. So, you know, that that just keeps this keeps building on itself. You know, we got to have the cattle. Demand's there.

[00:00:55]The consumer's eating it and we got to have the cattle. So, you know, whatever the board does, it does. We sure like to buy them cheaper with a little cheaper break even, but it's hard to get that done because the availability of these yearlings is not very good. So, you know, what we do, we just go to the market, buy them. We don't have much choice. That's where we're at. And it's the same way with the packer. You know, he's got to have the cattle. So, you know, he just comes to the market, buys them as cheap as he possibly can. But at the end of the day, he's got to have blood on the floor. That's what makes him his money, whether it's losing or making. He's still got to have blood on the floor because he's got a deal made with some retailer that he has to have the meat. So, it just feeds on itself.

[00:01:31]You know, we're all out there a little bit worried about what we're doing and maybe we're going to lose a little bit of money, but consequently, most of the time we still keep making a little bitty money. So, we're just going to stay in the market regardless of what level you're playing, whether you're a producer, a backgrounder, a feed lot, you know, a packer or retailer or you know, the end result, the consumer, you know, everybody's going to keep doing what we're doing until something really, really bad happens. And you know, this thing might back up 40 or 50 dollars 100 at that point. I'm not going to say it.

[00:02:01]And if you're a if you if you're a producer, you need to be protecting it your downside because this thing could get ugly quick if you don't. You know, we got a lot of tools out there we can use today with LRPs and some of those other things that and you know, we can hedge them out straight up and you know, with there's a lot of different things puts and calls that you can do. So, [music] you need to be paying attention to what you're doing because I know we've all made money, but at some point they're going to want it back.