BARRINGTON, Ill. (RFD News) — The USDA plans to resume fed-cattle imports from Mexico through an Arizona port beginning Aug. 24. The move marks the first step in a phased reopening of the southern border and remains contingent on safeguards and federal inspections.
Jim McCormick with AgMarket.Net says the announcement has been driving recent market action.
“It’s the borders open, plain and simple,” McCormick explains. “The Cattle Feed report was neutral. The market’s just repricing in the border being opening. Are they overdoing it, in my opinion? Yes. The reality is there’s not that many cattle that are going to make it across, and it’s not going to change the overall supply situation here in the United States. The funds have been liquidating out of the cattle in last couple of weeks. This headline of opening up the borders just gives them one more reason to move out of the cattle market.”
Blue Line Futures Vice President Oliver Sloup says the announcement was expected, and while it may create some short-term pressure, he believes the market will adjust.
“It’s one of those things where you knew the headline was coming,” Sloup says. “It was just a matter of when, not if. Ultimately, I think it’s probably good for the market.”
Sloup says traders will now be watching how quickly imports resume under the phased plan and whether the market finds its footing as additional details become available.
