USDA’s Friday afternoon announcement of a phased reopening of the southern border for Mexican cattle imports caught much of the industry off guard

CHICAGO, ILL. – Commodity markets had a rough start to the week, with soybeans leading grain losses and cattle futures taking a hard hit alongside a broader selloff that spilled into hogs and outside markets.

During Monday’s (July 28th) episode of Market Talk, Mike Minor of Professional Ag Marketing pointed to what he’s been calling the “big three” all summer — the Iran situation and its effect on crude oil, China’s trade posture, and weather — plus a newer factor: renewed talk of a Russia-Ukraine ceasefire. Over the weekend, he said, all four leaned bearish at once.

Weather was the biggest driver. AI-based forecast models turned more favorable for the extended outlook, even as the Euro and GFS models were less dramatic.

On the cattle side, USDA’s Friday afternoon announcement of a phased reopening of the southern border for Mexican cattle imports caught much of the industry off guard. The first port in Douglas, Arizona opens August 24, with Santa Teresa, New Mexico — which handles roughly a third of cattle crossings — and Columbus, New Mexico expected to follow. Minor noted the industry still has about a month to see whether Mexico’s progress on screwworm, mitigation holds up before the reopening is complete, which is why back-month cattle contracts are taking a bigger hit than front months.

He also pointed to feeder cattle placement losses of $300-plus per head as a logistical reason the reopening makes sense right now. Cattle futures have been sliding for about a month and are testing support near the lower end of the uptrend that’s been in place since 2020.

Minor’s advice for producers: don’t let a single rough day change the bigger picture. With soybean futures still above $12 and carrying some weather premium, and new-crop corn holding decent value, he encouraged producers to keep making sales above crop insurance levels and stay proactive in a tight-margin environment.