Sprecher: This is Market Plus for the week of June 27th with Tomm Pfitzenmaier and we're going to spend a little time on the cattle market. Tomm, you seem to think there is a considerable amount of upside in this market.
Pfitzenmaier: Yeah, like I said on the show I think that the weights are coming down, the cattlemen are staying current. We've got this Canadian situation that at first blush obviously was negative but the more you think about it and those cattle keep getting held out of the United States, it lowers our numbers, it's scared the cattlemen so they're staying current. I just think it's a good situation. Now, what's going to happen, the big question is what is going to happen when those Canadian cattle come in? So, I think if you can get a dollar and a half, two dollar rally like I talked about that presents an opportunity. It's going to cheapen those puts up, give you an opportunity to put a nice floor under the market and then Sid, if the Canadian dump causes the cattle market to drop sharply you've got the protection. If it doesn't, if the base fundamentals of the cattle market stay okay, then great, sit and figure it costs you a little insurance money and away goes the cattle market. So, I mean, I think it's a good situation sitting up here over the next two to three or four weeks maybe.
Sprecher: It seems like in a lot of ways this cattle market is maybe the most simple of markets because the biggest single fundamental that could affect it is across the border.
Pfitzenmaier: Right. And if prices, as you say, are good and you can buy puts it would seem there are not a lot of other variables in this market. Demand appears to be fairly good. I think you've seen a little switching, if you've watched pork product prices have kind of dropped over the last couple of weeks and I think there's a little shifting back over to the beef side. Unemployment is up but still, 94% of the people are working and like to eat well so I think demand is probably going to be all right. Yeah, I think it's a good sound market.
Sprecher: You mentioned the pork market a bit. Is there much upside on that? It seems like it's just kind of lagging.
Pfitzenamier: Yeah, it is. I mean, we went up and put a really nice high in here about two or three weeks ago and sold off. Now, the question is, are we in the process, was that the high and we're just going to continue to tail off from there? Or are we going to find some buoyancy? You know, this hog and pig report out Friday afternoon shows that there has been some liquidation so the producer is pulling back a little bit. That ultimately is going to tend to be a little supportive of the pork industry. So, I think in the long run it's going to be fine too but it's going to struggle a little more than the beef does and it's been getting, the slop from the beef industry and the scare from the Canadian cattle and everything, that's spilled over and hurt the hog market to some extent too. So, that's a factor in there also. Well, we've seen that poultry hasn't been this big an influence on either one of those markets as it has in the last five or six years. We actually had some pull back in the poultry numbers there for a while which is the first time that had happened in a long time. Now, I think chick placement is starting to come back a little bit, but yeah, that hasn't been the competitive factor that it had been, that's for sure.
Sprecher: Thank you, that wraps up this week's market plus with Tomm Pfitzenmaier.