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Welcome to we live it the Live Ag podcast. Your source for livestock market insights, management strategies, and real conversations with those who don't just work in the cattle industry. They live it.
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Here are your hosts Ty deCordova and Casey Mabry.
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Welcome to we live it live podcast.
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Thank you guys joining us out there. We just want to kind of go over what what this podcast is going to be about, Casey, Casey, myself and our team have come up with this here a couple months ago and thought it would be a great idea for us.
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Sit down and.
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Please and kinda talk about the industry stuff I go over.
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All the aspects of the industry, from the raising the cattle, the marketing, the cattle to the market, strategies that y'all do there believe to, to sell them to me, to just all in between, everything in between, from birth to when they get on the shelf. I mean we.
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Kind of want to cover all of it and kind of get different aspects of the industry involved in it.
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So we'll we'll go and get started here and kind of tell you about what we want to do and tell you a little bit about ourselves.
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First of all, I'm Ty deCordova.
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Been in the industry pretty much my whole.
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I grew up in industry. My dad had an order buying company.
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My grandpa, my great grandpa. On the 1st sale barn there and Groesbeck where I was born and raised.
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My grandfather, he managed one of the hitch for quite a while for the hitch family.
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And then as we got older, grew up in a cell, Barnes buying cattle.
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Marketing cattle grew up in a video company.
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Livestock grew up in that southern cattle on the video with my dad, and then I in turn, went to work for them for quite a while.
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While then me and my brother and my dad bought a sale barn back in 2006.
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So we've kind of been in the industry for a long time.
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It's kind of how we was raised up and that's hence the title of the program.
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Live.
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I mean, so we live it on the market side where kids show cattle and Casey's kids show hogs and cattle and we just we kind of love the industry, we love the.
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The agricultural part of the industry and we love the people in it and that's kind of who we want to highlight as we go through here, the next several sessions and next several podcasts, we want to get several different people in the industry on here with us.
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Case you want to kind of tell a little bit about your background.
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Yeah. I mean, First off, I think, I mean, Tyler, I'm excited to be part of this deal with.
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I think we've talked about this several times and and just have the idea around doing this and obviously this is a big undertaking and and your team of people have put this thing together to to do this.
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Mean there's lots of misinformation out there. It's the the.
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One, I mean, there's some talking heads that you see in this industry that will get out there and do some YouTube stuff or?
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Maybe there's some, you know, structured, advertised, different, you know, things that are out there as far as.
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Video kind of.
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Things go, but where my head's at is just like you said.
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Mean having some people in here
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That are from the industry, whether we're talking to bankers, you know, talking about lending and how that impacts people. But all the different aspects of of we know the guys that we're dealing with, you know the producers, us, the people that are buying cattle, selling cattle, feeding cattle
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You know, running cattle on grass.
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And dealing with that. So I mean the people that are actually living in it, so.
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Yeah, I'm excited.
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I think it's going to be awesome.
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My background is probably a lot different than what most people's in this industry where I'm now over 40 years of age and so I think I've become where people respect.
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Know that's what whenever you're you're a kid.
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Is that where you have to get?
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Yeah, it's 40.
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I.
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There I was.
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How?
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Maybe I got to get over 45.
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I had a long time guy that I used to buy cattle from that he called me last week and he asked me if I was going to be an NCBA convention and he wanted to sit down and talk to.
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I don't know.
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For me, and I said, you know what? It's funny. I'm over 40. And so now you want to talk to me about the markets. And so before that, I was a kid. But so my background, I grew up. My dad trained thoroughbred race horses.
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So we would have lived in Louisiana until I was probably about 12 years old.
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And then we moved to Weatherford, TX.
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So you wanna move the Weatherford for the race?
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Trinity meadows. I'll be Dang. We race horse. My great grandfather. Race horses there. Yeah.
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Oh.
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And that crazy.
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I did not know.
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That's the first I've heard of that. We used to go up there every weekend and race horses.
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Yeah. So yeah, so.
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Yeah. So we moved there and about 1991. And so, yeah, so my dad, my dad was a born and raised in Texas. And obviously, if you're.
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I don't see that.
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And you're living in the state of.
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You want to get a better education for your kids, and so he's like, I want to get over to Texas.
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So we moved there when I was about six grade, I got heavily involved in livestock projects in FFA.
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Showing cattle and showing pigs and. And so I got really, really involved. And I had a passion around the cattle industry and the meat industry.
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And really got excited about that. And and it's interesting that those programs and what they do for kids and I mean when you say we live it, I mean that's that is it makes the hair stand up on the back of my neck because now what we've gotten.
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This industry.
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In the past that I've gone throughout this industry, it all started.
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So my wife and I contribute a tremendous amount back. Whether we're giving money back into, you know, live or the sales, the county auctions to give kids scholarship money to go to school.
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Mm.
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Or judging teams and things like that.
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And so anyway, so after I graduated high school, I went to college, studied animal science, meat science.
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Once it's my undergraduate there at Tech and then went to Graduate School at Tarleton and coached the judging team there, Cargill gave me a tremendous opportunity.
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There's a Randy Hines there at Tarleton. When I said I wanted to go to meat industry and what job there was out there.
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He said the best job in the world's being a fat cattle buyer and so I got that opportunity with Cargill and I jumped right on it.
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So I bought fed cattle in western Nebraska and eastern Wyoming.
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For about 6 years and I really learned a lot from people. And so The funny thing is, I had never really been in a feed yard much.
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And so that's a good thing and a bad thing, I guess.
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And the other thing is, I'm not necessarily scared to ask questions and learn. And so I dug deep in there with some of them guys and some mentors that I've had over the years that were, you know, just really good guys in the cattle industry.
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Cargill gave me an opportunity to move to Wichita and so I was overseeing all the formula cattle. All the the committed supplies and things like that.
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So I got exposed all the grids and all the different larger feeding operations.
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And then some box beef pricing. I spent a couple years overseeing all the box beef pricing and so.
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Came the blue reef about seven years ago now.
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That seven years has gone.
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Extremely fast blue Reef started out as a as a couple of guys that was helping farmers.
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Merchandise, grain and help make make decisions in markets and tough.
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And so we thought there'd be pretty good opportunity do that in the cattle space. And so we did.
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That now it started out as a couple guys and now we've got about 12 or 13.
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We've got an office in.
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We've got an office in Weatherford, TX.
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Now we've got one down in San Angelo, TX with different cattle advisors there.
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We've also got a couple grain advisors in the Midwest. So one's in Illinois and then one's in Indiana.
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And so those guys focus on row crop farmers.
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So we limit who we do business with.
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We have a smaller amount of larger customers, so we can dig in deep and get to know those guys operations, whether we get to know them, their wives and their kids. But we want to know their operations in and out so we can help them make better. Dec.
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The markets, because these things are tough.
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Make it personal and it's got to.
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But no.
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That's the that's what I love about the industry is you can get so personal and they their customers, then they become family. I mean that's.
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But pretty cool stuff.
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Yeah. And so, I mean it's I think I think as you and I go through this journey over the next, however long it lasts, hopefully.
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Yeah.
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You know, until we get booted out of here, you know. But I I think the biggest thing we probably look forward to is bringing useful information to people.
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Not just some words that are, you know, spit through these microphones or canned something that's real, something that gives us an opportunity for people to learn and get to kind of maybe self reflect and think about their operations and make them better.
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Sure. Yeah.
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Another thing we're going to do, we will start doing and I guess we'll do one tomorrow is the live recordings. We will do live podcasts from from our auction sites ever, ever.
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We have the morning of Will will have a have a couple of guests on that, whether they're industry partners or buyers.
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We got a buyer, buyer 2 coming on.
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And that's that's what you know that lab do is is pretty fun like we did in Denver.
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Kind of.
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Kind of roll with it so.
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Yeah. The only unfortunate thing is everybody stands around the audience and kind of makes hand gestures and tries to get you cracked up a little bit.
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Yeah, yeah.
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That's not hard to do though, is it?
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No, it ain't. No, it ain't. No.
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Our future future guests will be we have John Sloan with Texas going to come on here in a couple weeks.
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Have Dennis Meskers one of our reps, going to come on here.
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Here in a couple weeks too, and join us and talk about some stuff on what what we see as a Rep and what the Rep should do and how they should conduct their business and stuff.
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We've got a lot of lot of good things coming out tomorrow. We got GFX going to be on.
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With.
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Sen.
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Hollow trading and he'll be on about on the buyers side of the deal and talking about different things and what they look.
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So that's just kind of like you said, that's kind of the stuff we want to go over and go through is is stuff like that I mean?
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Which which I'm excited about.
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Yeah, I'm. I'm really excited to talk to John Sloan with Adcredit, and I mean, with farm credit, because that's one that over the last couple weeks.
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Mean just tell you that what the market, what it's done. I mean, the market's exploding and it's all good and everything's great.
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Hmm.
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I mean the backside of that thing is everybody's having to spend more money on cattle in the next turn.
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And a lot of times I mean, if the market's high, guys are hedged.
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So they're having to manage margin calls and most of the time we don't have to worry about banking things. We don't have to worry about equity crunch and things like that and borrowing bases.
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Mean things are just kind of normal when the markets.
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Quiet when we start going either higher, much higher or much lower. You know, we got to have start having conversations with our bankers ahead of time. And so it'll be good to dig deep in with.
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Understand that.
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Same thing with.
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I mean, you know, that guy's got so much knowledge on, you know, cattle classes in this industry, and it's just always fun to sit down and talk to him and go through some different stuff. So that'll be good as.
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But yeah, I mean those are going to be some good ones that we can really just learn from.
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Well, I look forward to all of.
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I think this thing's going to be pretty neat to to watch grow. I think it'll get bigger as we go.
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We'll get.
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More and more input like I said, just just super excited about.
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The family aspect of it, the industry that we're in, how we all kind of grew up together, doesn't even know it was, you know, heck, that that right there.
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Meadows, do I spend many a day there? When I was a kid out when you said that I.
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Like oh, you got to be kidding me so.
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Yeah, yeah. If you're 12 years old and spend all your time at the racetrack, particularly on the backside, you probably had a heck of an education.
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Yeah. Well, yeah, you some things not to do or maybe a lot.
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Yeah. Well, hey, what's funny is so I I when I interviewed for Cargill and this is back when I was like 23 or 4 years old coming out of school.
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Kimball was the head cattle buyer for Cargill.
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He was the VP of Procurement and I get my interview and he said man case, you don't really have a whole lot of experience in the cattle industry, you know, can you?
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Of.
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Tell me you know what?
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Experiences and I said.
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You know, I said as I've gone through life, I think through the backside of the racetrack and and not everybody can understand what I'm about to say, but there's all these different tiers of people at the backside of the racetrack or at the racetrack. You know, you got.
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The owners?
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And you got the trainers. You got the guys that are going there to gamble on race.
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But through that you can kind of segment all those people and that.
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There's probably helped me to read people, probably the most because all those different characters that you've got in that so.
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It's.
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It's an interesting place, but also is the cattle.
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You know, whenever you go to these different places and you see the different, it's a lot of similar deals where you guys that own the cattle, you got guys that run the operations where it's feed yard and ranches or whatever.
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Yeah, it's. This is a people business.
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This is a business that's always ever evolving.
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This is a business that you'll never have figured out, and so it's just going to be a pretty exciting to kind of go through that stuff.
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They're.
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They're telling me here to ask you about a market analysis, but I know your intake on that is, I mean you want to go into the markets or do you want to just kind of go through what it's looking like here?
00:12:49 Speaker 3
Right now, so we're sitting here February the 12th.
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I had a guy come up to me two days ago and asked me so the market put in a new high probably 10 days ago or so and so the market, let's just kind of like walk through psychologically where everybody's at.
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Mm.
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So one year ago.
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Well, fourteen months ago.
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Markets rallying, we're putting in new.
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Everybody's excited on the October Catalon feed report.
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We get a bearish.
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Signal the funds were very long cattle and all of a sudden the.
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Spilled out.
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So we went from, you know, the April contract at that time hit 19975 and I think everybody in their dog.
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In in 2023 was looking for $2.00 live cattle.
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280 feeders the market barely gets into that or doesn't get quite into that.
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A lot of people don't sell market fails.
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So we spend all of.
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For Toronto rebound.
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The market in the fall of 2024 starts rallying up and gets really close to where we were and everybody start selling the market. And so hedging the market, hedging, cattle selling, feeder cattle, selling fed cattle.
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And then the market continues to rally and it goes way above most people's expectations. And whenever you get a market that parabolically moves higher than that, you have to ask yourself why. And so in my mind, the market pops higher.
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And goes higher than that. Then what your expectations were, and if there's two ways to do it, either buying pressure or lack.
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Lack of selling is probably what drove it higher in my mind, because if you're a guy that sold cattle tie and you sold cattle, you know a week before and then the market goes higher, what do you think, man?
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Shouldn't have sold?
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So then you're not selling the next set of cattle. So then it creates this environment where the market continues to push higher.
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I think we're in.
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I think the market and then psychologically we've taken a little bit of a breather here. So I'm fed cattle, we've broken about 10 or 12 bucks off the hives and on feeder cattle, we probably broke about 10 or $15 off the highs.
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And most people, now that we've gotten back to the levels that we didn't think we would exceed, they're sitting here going.
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Is this thing gonna bounce back or when's it?
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Bounce back.
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And so I don't.
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And I never, and I always tell all my customers that I tell everybody to get.
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I don't try to necessarily predict the market. I just try to take the variables that we've got to play and kind of understand them.
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So here's what we've got.
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So February the February the 12th, we just finished the NCBA Convention. I was there for a short period of time, did a little taping with us. Farm report sitting up there with Doctor Darrell Peel and Don close.
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Those are two analysts that I respect very greatly.
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Everybody is very, very bullish from a supply standpoint.
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I think we might have gotten everybody on one side of the boat here for a minute because everybody is staring at supplies.
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The the demand side of the situation that's occurring today is we took box beef up to 2:30 from a cut out standpoint and we did it very rapidly and it stayed up there for a while and a lot of these retailers are having to digest those prices.
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Then they're passing that on to the consumer. If you walk through your local Walmart, you'll see a lot of yellow tags and a lot of markdowns on those products because the consumers.
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So you gotta ask yourself, is it because they're getting higher prices or are they getting crunched from other things?
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And so demand is kind of softened to some.
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I don't know if it'll be if it's a seasonal thing.
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Mean we're sitting in February. It's very.
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I have demand push lower, but we're seeing the kills be cut, so we see a one or 100,000 kill on Monday when we normally kill 125,000.
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We seen a a lighter kill each and every day this week, and so Packers are pulling back.
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Running 36 hours.
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And normally when they pull back you should see an adjustment on on cut out prices.
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Should go higher.
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We seen the cut out actually go down.
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And so that's a little bit of a.
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So not saying that that's going to happen long term.
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It's also February. Again, like I said, and you always have a softening in here. So right before you have spring grilling kick off.
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I feel good about the market. I'll tell you that.
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Feel really, really good about the market.
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Have had a breather here.
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On the front side of.
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That's one thing that we have to watch.
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Specifically, you know, whenever you're looking at the managed money side of.
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So the commitment of traders and so the cot comes out every Friday, it refers it.
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Called the commitment of traders.
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It comes out and says here's.
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The positions that are in the futures market.
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And here's who has them.
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And it breaks it down. It says commercial, which a commercial is.
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I'll just get a little educational here for a second. Commercial in any commodity is the producer.
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So whether that is the person that's buying that physical commodity in our instance would be the Packer or the person that's selling the commodity.
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The producer.
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So whenever you have a hedge account or any account, a brokerage account, you are marked as a.
00:17:47 Speaker 3
Or you're marked as a commercial or non commercial and so whenever you put those positions on then the cot can come out and the CFTC comes out and says here's all the positions there. And so today in life, cattle think there's over 300,000 open total open.
00:18:03 Speaker 3
That's the total amount of contracts that are on the on the books.
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And then they break those down and they say this is the commercial, the non commercial.
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Watch that because.
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That's the one place. So in the physical side of things, our buyers and sellers are producers.
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So you have a guy that goes out and buy some grass cattle. At some point he has to buy the lightweight calf. He has to go out and sell that thing at some point, whether he puts it on feeding, sells it as a fat steer or he sell.
00:18:33 Speaker 3
As a as a calf.
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You got a feed yard that goes out and buys, you know, whether they're buying a four way dairy cross calf or they're buying a 7 weight. They're a buyer.
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And at some point they got to be a seller in the fat market.
00:18:45 Speaker 3
Right. That's the commercial side of we don't anybody else in our market in the physical side of things besides true commercials in the in the futures market, you got commercials, same people and you got non commercials.
00:19:00 Speaker 3
The non commercials are the funds, OK? And so you got all kinds of different funds. You got funds that are managed money.
00:19:05 Speaker 3
So those guys that are going out there and buying commodities based off inflationary beliefs, you got some of those guys that are speculative managed money.
00:19:13 Speaker 3
They might be looking at different fundamental factors and trying to just bet on the cattle market.
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Sell it or whatever.
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For short, you got index funds and so there's a whole myriad of different things that that drive that you have to remember in a room of in the CFT.
00:19:29 Speaker 3
Commodity market.
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In every other commodity like corn, your natural long is a corn originator.
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A guy is buying corn, whether that's.
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General Mills buying corn to produce, you know, whatever their their end products are.
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That's Tyson Foods. Buying corn to supply chicken as a, as a as a hedge against, you know, rising prices of corn or feed yards going out and buying corn offset cost of gains.
00:19:57
Mm.
00:19:58 Speaker 3
And the cattle side of things.
00:20:01 Speaker 3
We don't necessarily have a natural law.
00:20:03 Speaker 3
There's nobody in our space outside of the that that carries lots of long risk that they need to go buy cattle futures to offset that. A little bit of meat trade that sold way out front, but we don't have a true natural long in cattle.
00:20:18 Speaker 3
So we depend on the funds to be our natural long and whenever the funds are buying the market, it's a really, really good thing because the market's.
00:20:24 Speaker 3
Higher.
00:20:24 Speaker 3
Everybody's excited when the funds get long.
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And I already have all these positions.
00:20:30 Speaker 3
We have to look for them to expose or to leave.
00:20:33 Speaker 3
So when I leave, that's the same guy that bought the market has sell the market.
00:20:37 Speaker 3
When we have normalcy, you know the funds are 50 to 60,000 contracts.
00:20:42 Speaker 3
It's not a huge impact.
00:20:43 Speaker 3
Whenever everybody gets on one side of the boat, if you will, the funds get 150,000 long.
00:20:48 Speaker 3
They traditionally don't get any longer than that or have many more positions on than that.
00:20:51 Speaker 3
We know they have to exit and so will they exit today.
00:20:55 Speaker 3
Will they exit 6 months from now? Will they exit?
00:20:58 Speaker 3
You know, a year from now, who knows? Umm.
00:21:00 Speaker 3
But again, it's little situations that.
00:21:03 Speaker 3
You know, make them fronts exit, whether it's a bearish kettle on feed report like we had last year that puked the market out and that's whenever a cattle feeder start saying things like man this market's broken or the futures market doesn't work or whatever when it's going.
00:21:05
Hmm.
00:21:17 Speaker 3
We get excited about it when it's going lower. We're sit there and blame people so.
00:21:21 Speaker 3
Anyway, that was a long that was a long.
00:21:23 Speaker 3
On what's going on the market, the funds are the longest they've been ever.
00:21:27 Speaker 3
And that's the thing that I that I want to make sure that we.
00:21:30 Speaker 3
And so like I said, February the 12th, we've got an extremely long fund position in both feeder cattle and live cattle.
00:21:36 Speaker 3
It's above extremes. If you talk about from a standard deviation standpoint, you know off of a mean we're probably two or three standard deviations above their average position.
00:21:46 Speaker 3
That's my fear in the market.
00:21:47 Speaker 3
So if there's any one thing to be bearish about, it's that everything else is to be bullish about supply story.
00:21:53 Speaker 3
Mean we haven't started to expand the cow herd. All those different very, very long term.
00:21:58 Speaker 3
Reasons to be.
00:22:00 Speaker 3
So my market bias today is.
00:22:04 Speaker 3
I'm running with a keen sense of paranoia, so I'm.
00:22:07
Yeah.
00:22:08 Speaker 3
About the market.
00:22:09 Speaker 3
I'm bullish the market, but I'm also going to protect that with different, you know, positions and that be you know whether it's options or LRP.
00:22:17 Speaker 2
Cool. Well, I guess we'll kind of talk a little bit about our next steps.
00:22:20 Speaker 2
We brought up Dennis.
00:22:22 Speaker 2
He's going to be on the next next, our next episode of the podcast, and then we have some live ones coming up here pretty soon too, so.
00:22:30 Speaker 2
We want to thank everybody for joining us.
00:22:33 Speaker 2
Appreciate you guys for trusting us and listening to us.
00:22:37 Speaker 2
We're going to try to make this as educational and as fun as we can, where we're not just a bunch of guys sitting up here mumbling about stuff that we don't know what we're talking about. So.
00:22:47 Speaker 2
Like I said, we're going to bring in some pretty, pretty interesting people here in the next several months to to join us and to go over some things within the industry and we look forward to that.
00:22:59 Speaker 2
If you're, if you're out there and you want to join and you want to, you want to be a part of it, we ask you to go to live-ag.com and reach out to our marketing team.
00:23:09 Speaker 2
And we would love to have you on if you want to join in a sponsorship.
00:23:13 Speaker 2
Role or have some kind of industry partnership, we ask you to go to live-ag.com and also send in a request or reach out to the marketing team Katie and and and the gals there.
00:23:25 Speaker 2
Tend to tend to all that for us so.
00:23:28 Speaker 2
Just reach out to one of us and we'll we'll get you aboard and would love to have you.
00:23:32 Speaker 2
Thanks for joining us and once again, remember we live it.
