Welcome back to the table for the Friday, October 10th, 2025 installment of Market Plus. Joining us now with a refilled cup, Shawn Hackett. I'm not going to tell you what happened during the show. I want you all to read the story that I will write when we are done here in the newsletter for Monday morning. How's that for a tease, Shawn?
It's great, and it's a little further away. I think we're good for this.
We'll be good. We covered quite a lot of ground in that program. I always appreciate how we can go back and forth, but there's a couple more questions that I think you might have some insight on. And we need to start. We didn't quite get as much into the livestock market, but let's start with Adam in Wisconsin, if we could, please. Adam wants to know what's the deal with the current dairy market doldrums.
Last year we had avian flu, suppressed production. This year we don't have that, and we're getting a big rebound — 3 to 4% production growth at a time that we're seeing very weak demand domestically. When you put those two things together, and it's happening outside of the country as well, we're getting prices under pressure.
So we're not eating wheat, we're not eating dairy, we're not eating pork. I think — am I catching the three food groups you've mentioned here just in your time?
We're eating them, but just eating less. I mean, there's no question there's a consumer pullback in just about everything right now — cars, homes, I mean, across the board. The consumer is pulling back. He's worried about his job, and he's just not comfortable spending a lot.
Who might be looking to cut down on the number of producing animals? And they sell. We saw it last year — some of these steers on the dairy farm have been sold at pretty good prices. Do we see any sell-off in animals?
Well, that is the big culling period for dairy is coming up here as we go into the first quarter. I expect heavy, heavy selling with the cattle market at this high price. Thank goodness for them — they can equities and they can cash sell those animals and offset what's now becoming a loss price for them.
Well, Scott in Wisconsin, remember the last time you came on, or one of your last times where you came on and made a prediction. And we appreciate you doing that. But he just wants to find out what you think up here. When you were last on, Shawn, you thought cattle would top out in the fall. Are we topping out or taking a break from the bull?
The problem with predicting the market topping out now is we'd have to assume that either demand falls faster than it already is, and I don't think it will, or that we're going to get rid of the scrugham situation, which I don't think we are going to, and that we can be relied upon that Lula and Trump are going to get rid of their tariff war, which I don't think we have any confidence in. Given those three factors which are driving the cattle market going into the holiday season, very hard to predict that we're actually topping out. I'd have to back away from that forecast right now and say the way we traded this week, Paul, it almost looks like we might be ready for another run to the upside — just the way we traded this week.
Well, there was a sentiment in wheat that maybe oats was giving it a story on that, because we have to look for any indication we have. But this one is Randy in Iowa. This one's a little different. I'm not sure I've ever heard this one. Can gold pull grains upward?
It depends why gold is going higher. If gold is going higher because of inflation, yes. If gold is going higher because of a lack of confidence in governments, or a lack of confidence in the global monetary system, then the answer is no. And I believe that precious metals, especially gold, are not going up because of inflation. The way we understand it, it's going up because governments are just totally losing the confidence by the consumer. And when we have all this unrest and tariff wars, it just allows for a flight to safety, which is what the gold market is. A flight to safety is not the corn market.
$4,000 is a pretty significant number. I mean, have we seen this before? Have history with it at this level?
Well, we're at record highs. But what I think — if you think of what the gold market is, it's the global collateral that all governments then measure their debt against. So we have gold, Europe has gold, China has gold. So we revalue the gold higher than that collateral, that debt-to-equity improves. And that's what's going on now as the governments are revaluing the gold collateral against their debts to make the balance sheet look better. So that's more of the reason that I think gold is going higher — not due to inflation, but due to the fact that governments need to reset their balance sheets.
