Commodities

Ag Analysis Report – 8/22/19…Beef Is On Sale…For Now

A fire at a major U.S. beef processing plant earlier this month is upending American livestock markets, slamming cattle prices while benefiting meatpacking companies.

The Tyson Foods Inc. plant in Holcomb, Kansas, had the capacity to slaughter 6,000 head a day of cattle — or about 5% of U.S. beef production capacity — before it was destroyed on Aug. 9. The facility’s shutdown has created a livestock glut, dragging down futures to the lowest in almost three years. That’s giving meatpackers such Cargill Inc., JBS SA and Marfrig Global Foods SA access to cheap supply just as demand from retail shops booms.

Source

So how far will cattle prices decline, let go to the charts?

Monthly Chart (Curve Time Frame) – monthly supply is $152 and the nearest monthly demand is $99.

Weekly Chart (Trend Time Frame) – the trend is sideways with a downside bias.

Daily Chart (Entry Time Frame) – the chart suggests to go long if price can move down to the daily supply at $97

or one can play the break out to fill the gap.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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