Livestock Markets, Prices and Futures

What's Behind the Crash in Cattle Futures, Will Selling Continue? Grains Add War Premium

Fri, 22 May 2026 15:52:21 GMT

Livestock were mostly lower on Friday morning except nearby live cattle, grains higher.

Cattle Futures Crash: What’s Behind It?
Live and feeder cattle futures saw an ugly close on Thursday with limit down moves in feeders.

Scott Varilek with Kooima Kooima Varilek says the pressure came from fund long liquidation and was continuing on Friday with significant chart damage done.

“We’ve got a lot of new funds into these markets, but they were liquidating these contracts rather than rolling it back, just straight whack out,
taking their ball and going home is the way I heard it. And I think that sums it up. So I don’t know if there’s a reason why,” he explains.

However, he says with the stock market making new highs the fund money may be going towards the equities. “I think that’s just what started the break here and just kind of adding to the pressure as we go down,” he says.

Fund Liquidation Continue
Varilek says the funds may not be done liquidating, especially with the technical damage done in the market. While the long term uptrends are still holding there has been other breaches.

“We break a neckline on the head and shoulders kind of formation. My least favorite formation, but it is what it is right now. I have to acknowledge it. So some severe weakness that measures, you know, another $10 lower here on the fats and, you know, broke some of those short term trend lines. Long term charts are still, hey, we’re at some pretty high levels and we’ve got some significant room we can break before we test those,” he adds.

With prices at record highs he says the selling could get vicious.

“Unhedged guys that want to press their shorts. I mean guys pressed funds pressed along all the way up that’s kind of how it can act on the way down you know stairs up elevator down,” he says.

Fort Morgan Cargill Facility Lockout
While it was not new news the headline of the Cargill beef plant lockout at Fort Morgan, CO also contributed to the break in the market.

Followed by talk on Thursday that another plant in Kansas was looking to strike in sympathy. However, Varilek says that plant is slaughtering today.

“They voted to officially strike this week, and that was the headline. Well, it’s been closed for four weeks, so it didn’t feel like it was anything new to me. It’s just the fact that it just recircled back in there and everybody took it and ran with it. And rumors that another plant might strike to help out could have been part of the reason why we broke so hard yesterday, because that’s not something we need. I had heard rumors that they put concrete barriers all around the Fort Morgan plant, which kind of says, okay, that’s pretty serious,” he describes.

That sends fear into the market about the closing of another beef plant besides Lexington, Neb.

“And the packers still can’t find enough cattle, losing a lot of money, like which plant’s going to close next. So now the fear is, do they just leave it closed? You know, which is, it’s scary.”

Higher Weights, Discounts
Varilek says there was also threats by a major packer that they might start discounting some of the heavy cattle just as USDA releases two week old weight information showing higher weights even though producers have been pulling cattle ahead.

“We’re making them big and and then the weights come out yesterday it’s two week old data we’re expecting these carcass weights to start to mellow and maybe slip a little bit up seven pounds on steers and a five on heifers it was a little bit of a surprise. So, we’re not there yet but just the fact that one packer wants to start to to discount some of those heavies scares the trade,” he says.

Cash Market Disappoints?
Early in the week a regional packer bought some $265 in the North but by Thursday light cash trade was reported at lower levels of $260, which is a disappointment.

“We’ve had some $260 traction picked up quite a bit yesterday and the day before is when it probably started. And those are getting bought for a month out. You’re talking the end of May, $260. It’s getting hard to pass that kind of stuff up when you’re looking at what it was at the time, $7 to $8 basis. And now it’s a $10.50 basis for the end of June. That’s hard not to take.”

Cattle on Feed Positioning
The market was also positioning ahead of the USDA Cattle on Feed Report to be released Friday afternoon.

Average trade guesses have on feed at nearly 102% and placements from 103% to over 104% higher than a year ago and that may have contributed to the selloff.

“I mean, we’re comparing to really tight numbers the year prior. All of these reports, this Mexican border has been shut. We had dry conditions in cow calf country had a lot of cattle coming early off of wheat pasture,” according to Varilek.

So, the next two reports could show big placements. However, Varilek is hopeful the market has absorbed that news already since it has been anticipated.

“So we are penciling a lot of that into the market. So it’s not like we need to do another limit down day because there’s this big placement number, in my opinion,” he states.

Hogs Continue to Fall
Lean hog futures were making new lows for the move again on Friday morning.

Funds have exited a big chunk of their long position so what is the selling tied to?

Varilek says it has been frustrating because hog producers are going to be struggling if this doesn’t turn around.

“I am hearing the packers are not finding enough hogs, having to cancel some Fridays. We’ve got a lot of disease issues. You know, you just hear about another barn right in our area with 60% death loss on this group with PPRS and just, it’s been tough. You know, because the supply is tight, but it just looks like this demand to me just can’t pick up.”

Even at lower prices compared to beef he says pork demand has been lower than expected.

Many contracts have fallen below $100 so he is hopeful the market will catch soon.

Grains Recover Adding War Premium
Grains futures were lower yesterday but ended off session lows with the reversal higher in crude oil.

The market is adding risk or war premium once again fearful of the Iran conflict escalating over the Memorial Day holiday.

“I think there’s a little bit of war posturing. We’re getting a boost in that energy market, and I think that’s probably why we’re getting a little bit of a boost in the grain market here,” he adds.

Grain markets have been seeing pressure without a severe weather threat and the uncertainty over China with no purchases yet or additional details.

The hope is that long term support can hold in the grain markets.

CAB Insider: May 20

Thu, 21 May 2026 12:00:02 GMT

The run-up in fed cattle prices over the past four weeks has been impressive with a $16.67/cwt. live steer inflationary trend culminating in last week’s $262.85/cwt. steer price.

Federally inspected harvest head counts have also improved to fulfill larger boxed beef sales commitments on spring grilling and holiday demand. The past three weeks have averaged 532,000 head weekly counts compared to the 516,000 head average in the prior three weeks.

The steep upward price trajectory in the fed cattle market remains wholly supported on fed cattle remaining in tight supply and the tight grasp of cattle feeders keeping feedlot stays and carcass weights elevated. Weights continue to underpin beef production tonnage, cutting the harvest pace deficit for fed cattle.

(Certified Angus Beef)

Cash cattle values have run higher with no support from boxed beef prices as the Comprehensive cutout has been relatively stagnant for the past six weeks — after pulling back from the March highs. Wholesale prices are expected to adjust higher into June, in keeping with previous seasonal trends, but this has yet to develop.

June live cattle futures remain a deep discount to cash, trading at a $10.95/cwt. below the latest cash prices as of Wednesday morning. At this point in May, plenty of time remains for the June contract to converge with cash.

Forward contract feeder calf video sales have kicked off this week with a portion of producers pulling the trigger earlier than normal, capitalizing on the current market and offsetting risk. Fall delivery calf prices are showing breakevens calculated against the current record-high cash fed cattle market. CME Live Cattle contracts for next spring are nearly $30/cwt. behind today’s cash; this suggests that buyers are both “betting on the come” and planning to add significant cheap gains to back up total cost.

More on Price Spreads

In April we discussed the notable shift in the spring Choice-Select price spread as the Choice premium dropped to nearly $0.00/cwt. in spot market pricing. The trend has extended into May with the spread remaining well below $5/cwt. with numerous excursions with the Select cutout becoming premium to Choice.

Market analysts have appropriately focused on the rapid decline in Select carcasses, dropping from 12% of the fed cattle mix in December to average just 8% since February. This historically small Select share has created a scarcity in the category compared to the lower 1/3 Choice price, which is literally what’s left in the Choice box after Premium Choice brands, like Certified Angus Beef, have been marked up for a premium end point.

(Certified Angus Beef)

When considering the higher Select value, this year’s exceptionally small cull cow harvest is also important domestic ground beef demand is quite strong, with more than half of beef consumption in this category. The chart shows the relationship of the Choice-Select spread with weekly cull cow harvest since 2010. It’s clear that the cyclical trend of cow harvest has been closely aligned with the fluctuations in the Choice-Select price relationship. As cow harvest declines the value of lean, Select end meats increases as those cuts become attractively priced in relation to lean cow cuts. It’s a simple substitution effect as 90% lean trim inflates in value under supply constraints.

The second chart depicts the relationship of Select carcass supplies versus imported beef. Since the majority of imported beef is lean trim, destined to be ground a blended with 50% domestic lean trim, there is a clear relationship. As Select carcass supplies have declined, the imported tonnage has increased to replace tonnage while the market seeks to maintain balance in lean beef supply. Adding in domestic cull cow supplies to this chart would further illustrate how all three sources of lean beef volumes adjust to supply a relatively steady volume of ground beef for domestic consumption.

(Certified Angus Beef)

In contrast to the lean beef discussion, Certified Angus Beef brand cutout values have performed within expectations so far in 2026. The CAB cutout has averaged $17.63/cwt. above USDA Choice since January, just $0.90/cwt. lower than the same period last year.

Profit Tracker: Feedlot Margins Hold While Packers Bleed Red Ink

Tue, 19 May 2026 15:32:17 GMT

The market continues to surprise many observers. Last week’s 5-Area Choice Steer prices advanced to average $263.42/cwt. leaving feedlot margins averaging $177.77/head for the week according to Sterling calculations against a higher breakeven resulting from a jump in feeder cattle prices when those cattle were placed.

Feeder cattle prices last week were off $13/cwt. and dropped break-evens for last week’s placements to $243.51/cwt. from $252.52/cwt. the previous week. It should be noted that there are break-evens bumping $260/cwt. out in the country.

Packer margins last week continued to erode and fall further into red ink with Sterling’s weekly average -$298.42/head compared against -$246.42/head the prior week.

View the full Sterling Beef Profit Tracker for the week ending May 16.

The Beef and Pork Profit Trackers are calculated by Sterling Marketing, Vale, Ore.

(Note: The Sterling Beef Profit Tracker calculates an average beef cutout value for the week in its estimates for feedyard and packer margins. Other prices in the weekly Profit Tracker also are calculated weekly averages. Feedyard margins are calculated on a cash basis only with no adjustment for risk management practices. The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs. Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)

Another Week of Record Cash Cattle? Grains Soar on China Trade Details

Mon, 18 May 2026 15:40:53 GMT

Grain and hog markets were sharply higher early Monday, with cattle mixed.

Grains and Hogs Soar on China Trade Details
Grain and hog futures were sharply higher on Monday morning as the White House released details of the China trade framework on Sunday.

It includes ag purchases of $17 billion for 2027 and 2028, with 2026 prorated and totaling $8 billion. This is on top of the 25 million metric tons of soybean purchase commitments they made in October of 2025.

Brad Koomia of Kooima Kooima Varilek says the $17 billion dollar of ag products was non-specific. So it is not known which commodities it will cover but he thinks the likelihood is soybeans, feed grains and beef. However, he is less confident about pork purchases.

“My reasoning is based on the idea that they haven’t bought pork for years already. Plus, the China hog herd has expanded after being decimated by African Swine Fever. What they do need is feed,” he explains.

What About Beef?
China re-listed 425 U.S. beef plants to export after concerns about ractopamine in U.S. beef.

They have been a large customer of variety meats, not muscle cuts, according to Kooima.

“We’re talking about stuff that a lot of us don’t eat anymore. Tongues. brains, offal product, but they seem to like that sort of thing. So maybe we can get a little bit of that. I don’t see that that part would be a market changer,” he adds.

If the plants test positive the plants will get de-listed and even if the U.S. can certify the beef is ractopamine free will China be able to afford U.S. beef?

Will China Follow Through?
Kooima says the real key is will China follow through with the purchases?

“China’s not reliable. “The worry is, is that like before, you know, they continue to posture and they don’t live up to what they say they’re going to do. So it is a game changer if they actually uphold it,” he adds.

Will China Drop the 10% Tariff?
The other unknown is whether or not China will drop the 10% tariff on U.S. soybeans.

President Trump said tariffs were not discussed, while Chinese officials says there was an agreement to drop some tariffs, with no specifics released.

“Hopefully we can work through at least some of this deal. I just worry that we’ll have this high expectation and then there’ll be some other we stub our toe on some other matter. And then, you know, then we got to retrace again,” he says.

Cash Cattle Continue to Set Records?
Live cattle futures put in higher weekly closes last week on the heels of record high cash trade in the country at mostly $265.

However, the futures continue to lag or show a big discount to the cash market. So when will that narrow?

Kooima says it may not. “I feel like the signal that we’re nearing the end of this thing is the change in basis, where the the cash much outperforms the futures and that’s happened. I mean we just put on $10 at the same time that the futures market, depends on which month,
but even the front month is below the contract high that we made two and a half weeks ago. And some of the back months are more like $5 below those highs.”

He says while the market is really good now due to tight supplies and May being the best demand month.

“There is a bit of a problem with the Choice boxes at only $389 and having no premium to the select is weird, seasonally completely wrong, which is a warning flag, I think, from a demand standpoint,” he explains.

So, while the cash may go up but the futures may not retest the highs.

Funds Liquidating in Cattle
The reason is the funds are liquidating in the cattle futures and open interest is declining, due to fears of increased beef imports.

“So it looks like you’re getting some of these fund managers or whatever that are saying, you know what, I’m thinking about taking my ball and going home. I don’t want to. want to be out here exposed to an announcement out of the White House, about fine-tuning a potential
executive order to alleviate the domestic beef shortage,” he adds.

He says the assumption is that will include relaxing the tariff rate quota on Brazil beef.

“We’ve been getting a ton of stuff out of there already to get this grinding meat,” he says, “Every time they get that blurb, the algorithms react to it and you get a futures reaction to it.”

The market is also concerned about the reopening of the Southern border to Mexican cattle or the possibility of a case of New World Screwworm (NWS) in the U.S.

CME Raising Cattle Futures Limits
On top of that, the CME raising cattle futures limits is also chasing out the funds.

“Bigger limits require bigger margin requirements, chases further the small speculator, increases volatility, all sorts of things. Some traders at least don’t like the algorithms, because they prey on that sort of market activity,” he says.

Cattle on Feed on Friday
The market is also gearing up for this Friday’s Cattle on Feed report which will likely start showing higher placements according to Kooima.

“Sure, because we’re comparing to such a small number from a year ago because the border has been closed that long now. I would say, yes, you’re going to see a marketing number that looks pretty dreary because we’re feeding cattle longer. And you’re going to see an on-feed number that’s above a year ago, too, for that matter,” he states.

Ft. Morgan Vote
Monday and Tuesday the Fort Morgan, Cargill plant workers will be talking about a deal and voting on whether they will strike or not.

However, so far the market does not care says Kooima.

“We’ve been on strike for or they haven’t been killing for a month for four weeks. And the market just does not even care about it. It barely gets
a mention. The numbers are that tight, okay? You know, in a different environment where we have more cattle to go around, this would be a much, much bigger and more bearish thing. One almost gets the feeling that management isn’t really bothered by the fact that they’re not killing,” he adds.

Grains Soar on China News, Iran War
The grains gapped higher over night and are soaring during the day session on the China trade details but also the Iran war rhetoric heating back up. That has energy markets higher leading to some inflationary buying.

“The sense that we’re back into this, what do we do when we go into an inflationary type of an economy? Corn, beans, wheat, those things seem to benefit in that kind of an environment,” he says.

Cattle Higher as Cash is King, How Crazy Could it Get? Hogs and Grains See Fund Selling

Fri, 15 May 2026 16:02:43 GMT

Cattle were higher early Friday with the rest of the ag markets lower.

Cattle Rebound Friday
Cattle futures took a breather Thursday but were back higher early Friday with volatility reigning supreme according to Scott Varilek with Kooima Kooima Varilek.

He says the cattle futures are getting tougher and tougher to trade because of the choppy action. “Because there’s no bids, no offers. The volume is hard. I mean, you try to sell five feeders at the market and all of a sudden it kicks the order back because there’s too much movement.”

That is making it tough for hedgers to use the board.

“So and as we’re doing these hedge strategies, we said, OK, we would like to use a spring rally to try to get some long term protection on. Now,
putting that on is really hard in these markets and you have to be ready. It’s not going to be cheap to get some floors on in the feeder cattle market,” he says.

Record Cash but How Crazy Could it Get?
The futures market is still at a discount to this week’s record cash trade which continues to look bullish.

The volume of cash in the North was in the $265 area but the South also saw $260 to $262 as packers seem hungry for cattle according to Varilek.

“I mean, just the hunger from certain majors and all the packers out there buying these cattle is really wow to me. We get some $265 trade, you know, getting this really wide basis normally this is our widest basis is in May and at record prices,” he says.

And packers are buying at these prices for delayed delivery into even the middle of June which is also bullish.

“They’re just grabbing a bunch of inventory so that way they can sit for a while and then it seems like then they’re back the next week already. So still tight supplies up front. It feels really good. And I love it that some of these majors are out front. You know, for the north, that means a lot.”

He says usually Northern feed lots have a hard time getting bids from certain packers but that isn’t the case this year as the cattle market is into its tightest supplies.

“But we’re turning over to this calf crop where these weights are a lot lower, and we’ve got cattle on feed that we might not want to sell yet and packers are calling bidding on them,” he adds.

So next week he expects asking prices will be higher at $268 to $270.

Higher Cattle Limits
Part of the break in the futures on Thursday was news the CME Group was raising limits on cattle again to $8.50 on live cattle and $10.75 on feeder cattle.

Varilek says that only benefits the big fund traders and they are pushing for it, to the expense of producers.

“We do not want that as producers. It’s hard to see our bottom line change by that much just in the matter of seconds. It doesn’t feel like we need that,” he adds.

Ft. Morgan Union to Vote on a Strike on Monday
The Fort Morgan, CO Cargill beef plant union is expected to vote on whether they are striking or not on Monday.

However, Varilek says it may be a non-event because the plant has been dark and the market hasn’t cared.

” And it just feels like we haven’t traded that real hard just because it’s been closed for four weeks and yet we’re still seeing cash move higher. Packers are still very aggressive buying cattle. It’s like, OK, I guess I guess nothing happened. So if there’s some more new news next week, maybe we’ll see if it really dives into the market.”

He’s doubtful it will but the bigger concern is another plant closure.

China Beef News
Conflicting news reports on China re-listing nearly 400 U.S. beef plants for export ended with China still not accepting U.S. beef.

However, Varilek says the market did not trade it.

” I feel like we brushed it off, you know, just because, number one, we know Trump’s saying beef prices are too high and he wants to import a bunch of beef to try to handle this tight supply. So we know we don’t have just a large amount of beef to sell, to export, you know, so we don’t really have it. So then the fact that it came out that they’re not, I don’t think we’re trading that real hard,” he adds.

Hogs Spiral on Mexican Export Resistrictions?
Lean hogs saw a nice rally on Wednesday but failed to get follow through buying on Thursday or to start Friday.

Varilek says the inability of the market to find a bottom may be tied to Mexico putting some export restrictions on U.S. pig semen, live breeding animals and offal due to pseudorabies.

“A negative flag that it’s raising there just because Mexico is our number one customer there for pork and and we desperately need it and this adds value to some of the lower quality pork products,” he says.

He says this doesn’t impact muscle cuts but Mexico does take a large amount of variety meats and this accounts for 10% of all their imports.

That is offsetting some of the positive news in the market including that two to three packers aren’t killing on Fridays because they can’t find enough hogs.

Funds Sell in Grains on China Disappointment
Grains are lower again Friday after funds sold hard in the grain and cotton markets on Thursday.

It was in response to the lack of tangible agricultural purchase commitments from China during the summit in Beijing.

Will the funds continue to liquidate in the grains after the technical damage done?

He says, “Yeah, we’re doing some short-term chart damage here and things just are trading pretty ugly today despite the higher energy markets. The grains had rallied on hopes of China business and just the fact that we did not get any news the funds didn’t like it,” he says.

How Low Will Prices Fall?
Varilek sees the grains slipping back into the recent trading ranges but there is good chart support on the bottom side of the ranges that should hold going into the growing season.

“So I’ll be looking for Sunday night’s trade to kind of start to hold as funds usually liquidate in three day waves. We might try to find some value buyers, some end users in some of these markets. So not ready to write it off and say, we got to go find some new lows here,” he says.

Beef Profit Tracker: Packer Losses Deepen as Feedlot Profits Hold Steady

Wed, 13 May 2026 16:16:27 GMT

The impact of higher Choice steer prices against only minor upper movement in the Comprehensive Beef cutout definitely made an impact on beef industry margins last week.

Sterling’s estimate of beef packer margins averaged -$246.42/head against -$123.35/head the prior week while feedlot margins averaged $186.70/head and down only about $7/head from the prior week as estimated break-evens were about $.50/cwt higher with a $2/cwt higher feeder cattle cost.

View the full Sterling Beef Profit Tracker for the week ending May 9.

The Beef and Pork Profit Trackers are calculated by Sterling Marketing, Vale, Ore.

(Note: The Sterling Beef Profit Tracker calculates an average beef cutout value for the week in its estimates for feedyard and packer margins. Other prices in the weekly Profit Tracker also are calculated weekly averages. Feedyard margins are calculated on a cash basis only with no adjustment for risk management practices. The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs. Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)

Cattle Bounce Early, Act Toppy: Grains Rally Adding War and China Premium

Mon, 11 May 2026 15:35:34 GMT

Livestock and grain futures were mostly higher early Monday with risk on buying across the complex.

Cattle Futures Bounce After Lower Weekly Closes
Cattle futures were higher early Monday after disappointing closes on Friday with lower weekly closes in both live and feeder cattle futures.

Brad Kooima with Kooima Kooima Varilek says the action was a red flag to him since it came after record fed cash trade.

“After 45 years what comes to my mind is when you whip the horse he had better run. Which is a way of saying when the news is good it should rally when the news is bad it should go down. If it doesn’t then you should evaluate just exactly what is the market trading,” he says.

Last Thursday the futures broke on fears of increased Brazilian beef imports and a change in the tariff and quota as President Trump was meeting with Brazilian President Lula.

However, when that didn’t materialize Kooima says the market should have recovered on Friday and it didn’t.

Futures vs. Record Cash
The other concern is that the futures failed to rally on record cash news of up to $260 in the North.

Kooima says, “Are you kidding me we got $260 and a lot of the $260 bought up in my region was for all the way into the first week of June from a couple of the major players.”

Basis Play
He chalks it up to a basis play on cash cattle where the cash is higher than the futures and this wide disparity between the two is mirroring the last bull market in cattle in 2014.

“One of the features to that was that we had an extreme basis. We had at times where futures were much below cash. I mean, like $8, $10, $14 for a while, $15. I wonder if that’s how, as we get to the end of this rally that most of it maybe won’t come in a basis adjustment. In other words, where cash goes much above futures,” he explains.

This happened in 2025 according to Kooima. “Now, last year at this time, hey, $8 or $10 or whatever, you know, with cash above futures. We traded like that a long time last year, okay? So, you know, part of me is going like, hey, you know, to have the June’s $10 under cash isn’t the first time. But I think, you know, you got to look at at least, I look at it a little more analytically.”

So, even though numbers are tight on cattle, the market may be indicating that demand isn’t going to stay very good.

Beef Demand Faltering?
Kooima says there is already evidence beef demand is faltering with Choice beef just over $388, in the face of slaughter cuts and a weekly slaughter of only 527,000 head.

He says that is a problem. “I’m becoming worried about it. Maybe two weeks ahead of Mother’s Day, usually that’s where we catch. That’s where the boxes start to rally. That’s where the middle meets, which is the steak cuts. You sell more strip steaks on Mother’s Day weekend than any other weekend of the year, followed by Memorial Day and Father’s Day.”

At the same time the market sees a movement of choice over select where there’s more demand for these these better quality cuts and that was only $3.38 on Friday which he says is not a good sign. It also means negative packer margins, which can’t be sustained and may result in another plant closure.

“Are we going to lose another packer or something like that or another shift or something. If you’re a packer and May is the month that you almost always make a lot of money and you are like halfway through and are losing like this, I’m sure that those Monday morning boardroom meetings got to be not much fun at all for them,” he adds.

High Gas Prices?
Is the slower demand a function of high gas prices finally taking their toll? Or it is just higher beef prices at the store?

Kooima thinks it is probably both at least in the case of higher priced cuts.

“Now, I should mention that, you know, when we talked about demand, demand for the grind is good for the hamburger,” he adds.

And if gas prices start to come down he thinks consumer demand will rebound quickly.

DOJ Probe Spooks the Funds
The other concerns is that the funds, who are long the cattle market, have likely seen the headlines about the DOJ investigation of the big four packers and got spooked.

“If you’ve got a fund manager, an algorithm that trades or reacts to headlines. What’s the long speculator going to do here? He’s going to go, well, geez, I got to trade crude oil. I got to trade Iran war and now this DOJ probe. If they think that there’s a chance that something really comes of that breaking up the big four it would be extremely bearish in the short term,” he adds.

Funds are currently long over 138,000 contracts and added nearly 6,500 contracts to their length last as of last Tuesday.

Feeder Cattle Futures Discount to Index
The feeder cattle futures are also at a big discount to the cash index index according to Kooima.

Feeder index today is going to be up around $375.86 is our guess. So we’re trading about $6 under or something like that. And as someone who’s actively in the cash feeder cattle market for these good 800 pound kind of cattle, if you can find them in the north, they’re not much cheaper, if any at all. So the demand for the cash feeder cattle continue to be very strong,” he says.

Hogs Bounce Off New Lows
Lean hogs futures were slightly higher Monday morning but bouncing off of new lows set on Friday. So can they hold?

Kooima says there are many fundamentals that should support the futures including the disease issues in the country and high priced feeder pigs.

However, it is being offset by the ample slaughter figures which is holding back the board.

Domestic demand has been steady but globally he says China is not buying much U.S. pork with their large hog supplies and there are concerns about Mexico.

Grains Higher Adding War, China Premium
Grains started higher on Monday adding premium back in as the war continues in Iran and heading into the China summit on May 14 and 15.

Kooima says the market is hoping for some additional China commitments but talk Friday puts their purchases of soybeans at another 12 to 13 MMT for this calendar year, which would be a disappointment.

The corn rally last week was capped as well on the July contract with a double top and the May WASDE will be a reminder of the large old crop corn ending stocks he says.

Still he is hopeful if the U.S. can secure some China corn purchases it could help corn and soybeans to continue to rally.

Cattle Digest Record Cash, Brazil Import Talk: Grains Try to Recover

Fri, 08 May 2026 20:45:22 GMT

Livestock were leaning higher early Friday. Soybeans higher and corn and wheat mixed.

Cattle Recover With Record Cash
Cattle futures were higher on Friday after recovering well off the early lows on Thursday.

Scott Varilek of Kooima Kooima Varilek says cash trade developed in the South at $256 to $258, up $2 to $3.

However, in the North trade started at $256 but by the end of the day trade was all the way up to $260. Dressed prices ranged from $400 to $405 with the volume at $402, up $3.

He says it was unexpected after the $10 to $12 higher cash last week. “That was the surprise, the highlight from yesterday where we have markets that are crashing in a big, big fashion. Then all of a sudden we started to hear some cash bids in the South and it was $256 in Kansas or Texas. And then all of a sudden it was $257 up to Kansas, then $258. Then you’re getting $260 rumors around the North. People start asking $260 and some guys got it. It was, wow, never been higher cash,” he details.

That brought the board back on Thursday and helped with the early rally on Friday.

He says the record cash cleaned up the showlists and packers were buying for delayed deliver as well, which is bullish.

“I heard the $260 mainly in the North, you know, it kind of started in Western Nebraska, but they sell with a 4% shrink there. And then when it kind of finally came to Eastern Nebraska and Iowa, that’s with a 3% shrink. So that’s even a better price yet. I didn’t hear a mountain of anything, I guess, as far as the South goes at $260, but they trade such small numbers anyway. I guess it wouldn’t surprise me if they did. But we’re likely done,” he adds.

Cattle Market Broke on Brazil Import Fear
“Yesterday’s news was the Brazilian president coming up to the White House to meet with President Trump. And I think that just started some fears, that are we going to import some more beef raise the quota so we we can bring more in because President Trump says beef’s too high,” he explains.

So the market reacted and turned significantly lower.

However, by the end of the meeting Varilek says they didn’t address beef and agreed to keep talking.

“So, we saw a big recovery yesterday as it kind of started to diminish those fears just a little bit on that news.”

DOJ Probe
There was also increased talk about a DOJ probe into meat packer price fixing which may have also spooked the market.

The Assistant Attorney General detailed actions against AgriFax for price fixing in the pork, chicken and turkey business and how that would be used as a precedent for the beef packing industry.

He says, “I think that’s just some extra uncertainty we’re throwing on the market. You know, I think we all look at the big four and, you know, us that are in the production industry, we understand that that’s been frustrating for many, many years. And, you know, where you want to say, yeah, that sounds like a great idea. It just makes you a little nervous. You know, the government’s getting involved. If they swing a big stick, it could really change the whole scheme of things, I guess. And just that uncertainty that circles around it is a little bit scary. So what does that look like? We’ve got some foreign-owned packers. We’ve got the big four that we talk about all the time and love to complain about. But just when their hands get in there, I think you’re a little bit nervous just what the outcome could be there.”

Retest the Highs?
So can the cattle futures retest the all-time highs with the help of the cash news?

Varilek says the one thing that may hold the market back is boxed beef values. They were lower on the close yesterday and while the negotiated totals are a small part of the actual sales, the trend is concerning.

“Just the prices that we are seeing are pretty lackluster and in the height of our demand season we’ve got Mother’s Day weekend coming up. The choice select spread negative and not seeing any major you know rallies in these boxes that’s a little bit alarming,” he adds.

Next Cattle on Feed Report
The other factor that could start to turn the market sentiment is bigger on feed and placement numbers in the next Cattle on Feed Report.

He says, “We’re going to have to start getting used to that just a little bit as we’re comparing to historical tight numbers from the year prior. So wondering what that does to the market. Does it start to drop off those deferreds as we see more numbers, get used to some, you know, seeing some of those on feed reports that aren’t just super duper friendly. So I think that’s something to keep an eye on here. We already have the deferreds kind of holding back. you know, thinking there’s more numbers coming, it’s going to happen later. And it kind of creates that bull spread market when, well, cash is still $260. So I guess the front’s got to stay up.”

He also expects numbers to start to creep up with the drought and some cattle being sold early due to the lack of pasture or some cows being culled.

“We culled this cow herd really hard two years ago. Last year really kind of took that off. I think started to rebuild, keeping those cows back. keeping some heifers back, and that’s going to give us some long-term hope that we’re going to get some supply back. But the only other factor is it’s dry in cow-calf country. Grass is running a little short, so does that kind of start to kick the can down the road? And maybe we’ve got to bring some of those extra numbers back into town early,” he further explains.

Cargill’s Fort Morgan Plant Dark
Meanwhile the Cargill plant in Fort Morgan is still dark as workers are still not back to work but the market has really faded the news.

“And not hearing anything about it. It just seems like, you know, the Greeley plant was in everyday news and we talked about it. We maybe had more to talk about. This one doesn’t have any news and we’re just kind of brushing it off,” he says.

Hogs Mostly Higher
The hog futures were mostly higher Friday except for the spot month as Varilek says the back months are still building in premium on tighter supplies tied to disease.

Still the cash market has not taken off so the futures are being bear spread.

“Supply traders are all starting to push disease back to more through July and October that’s what it looks like now,” he adds.

PRV Export Restrictions
The front end of the cattle futures are also pressured by the news that Mexico is looking at restricting U.S. pork variety meat imports due to the cases of Pseudorabies in Iowa.

“Mexico talking about curbing some exports and making some different requirements for us. So, that’s a little bit of ripple effect that’s starting to happen is that’s there there could be some effect and you’ve got pork we rely on exports for that industry. So, Mexico being our number one customer that’s a that’s a one to swallow,” he says.

Grains Try to Recover
The grain markets have had a tough week trading lower with the energy markets on a possible cease fire with Iran and opening of the Strait of Hormuz.

Iran rejected the deal so energy markets recovered on Thursday and are around steady on Friday.

That is helping the grain markets recover.

“And I think it just shows you how much war premium is in that market. You know, the energies were really on fire at some very high levels. And when they started to correct mainly because there’s more ceasefire hopes there’s hopes that we’re going to going to make a deal took the wind out of the sails of those energy markets and grains absolutely followed that down,” he says.

Corn and soybeans held support on Thursday on the charts and so they are bouncing off those levels but have retreated down to the lower levels of the trading range.

WASDE and China Summit
The markets may also see some positioning going into the end of the week, and with the May WASDE and the China summit scheduled for next week.

Varilek says the China trade hopes should support buying in the soybeans but the WASDE may not be that friendly.

“You know, we always get that reminder of our ending stock number and how much supply that we have. And hopefully it’s a surprise. And we’ve really started to chew into it from some of this increased energy demand,” he says.

He is also expecting lower wheat production estimates from USDA based on poor conditions in hard red winter areas and with the Kansas Wheat Quality Council tour likely to confirm lower production.

Beef Profit Tracker: Packers and Feeders See Sharp Gains as Market Surges

Wed, 06 May 2026 14:31:28 GMT

Beef packers fared much better last week in the face a higher Beef Cutout which was up $3/cwt. from the prior week, and a lower cost of cattle paid two weeks prior for slaughter last week. The 5-Area Direct Choice steer price 2 weeks prior for slaughter last week averaged $246.19/cwt. and advanced to $255.13/cwt. last week.

Sterling Packer Margins averaged -$123.15/head against -$188.23/head the previous week. Another contributing factor was the sharply higher drop credit averaging $219.43/head and the highest since the week of Nov. 19, 2022.

Feedlot margins also improved sharply last week averaging $193.33/head compared to -$2.50/head a week earlier.

View the full Sterling Beef Profit Tracker for the week ending May 2.

The Beef and Pork Profit Trackers are calculated by Sterling Marketing, Vale, Ore.

(Note: The Sterling Beef Profit Tracker calculates an average beef cutout value for the week in its estimates for feedyard and packer margins. Other prices in the weekly Profit Tracker also are calculated weekly averages. Feedyard margins are calculated on a cash basis only with no adjustment for risk management practices. The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs. Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)

Cattle Fall After Reversal, Is the Top In? Corn Above $5, Beans to New Highs

Mon, 04 May 2026 22:24:04 GMT

Grains end mostly higher Monday, with cattle and hogs lower.

Have Cattle Topped?
Live and feeder cattle futures were down for a second day on follow through selling. Both made record highs on Friday and then closed lower on big volume scoring key reversals.

So is the top in the cattle market?

Brad Kooima of Kooima Kooima Varilek says it is dangerous to try to pick a high in this market but it fits the profile of a technical top.

“Some 45 years ago I learned a reversal has to be from a terminal area, which is just a fancy way of saying an important area. And I don’t know what’s more important than the all time high. So, we did that on Friday. It has to be done on big volume. It was 86,000. It should be accompanied by an increase in open interest, and it was. And then the third thing is that it should have followed through the following day,” he explains.

However, he says the market ended well off the lows because at one time feeder cattle were over $7 lower and the June live cattle closed almost $3.50 off its lows.

“While it was still lower, it was a long ways from where it was,” he says.

Cattle Hold Critical Support
So the market held the support it needed to on the charts because according to Kooima June live cattle stayed above the 50-day and the
20-day moving averages, which has been kind of significant to keep an eye on.

“August feeders got a little whippy. We got all the way down to 62% retracement, then held that. So I’d say we did good enough holding what I think was technically important,” he adds.

Cash Trade Topped?
Several fundamental factors may have also caused the sell off including this week’s cash expectations.

Last week the cash market hit record high levels with Southern deals mostly $244 to $256, up $9 to $10. The North was $255 to $258 live and mostly $400 dressed, up $14.

The average steer price was reported by USDA at a new record high of $255.02, up $8.84. So it will be hard to see an encore.

“I mean, the market was basically $246 last week, Wednesday, I think. I know I passed $248 on Friday then, but if you compare like $246 and then getting cattle as high as $258 last week. You find me a week where that happened before. There was a couple of weeks in 2014 that were like that, but maybe not quite that much,” he says.

Kooima adds that it is interesting the packers came out already so aggressively on Tuesday and Wednesday, to try to buy cattle.

“And dovetail that with the fact that a month ago or so, there was plenty of these basis deals made by some of the major packers where they were willing to pay five or six over where the Junes were for the first two weeks of May. At that time, that was the equivalent of like $252 on cash cattle. At the same time, the cash market was probably $5 to $7 less than that. Well, a lot of guys did that because that looked pretty attractive, right? Turns out it’s cheap now compared to what the packer paid last week,” he explains.

So the packer was trying to get enough inventory so they didn’t have to work so hard to secure as many numbers this week theorizes Kooima.

“So you’re going to have a standoffish week on cash, maybe. Let’s call it steady due to lack of trade, perhaps, just because I don’t think we’ve
got very small show lists up here in the North, very small. So we don’t have much for sale, but you might have a packer that might not need to buy much,” he says.

Kill Cuts
That because the packers are trying to cut kills this week to prop up their margins.

“I’m not going to say names, but there’s plenty of them that are going four days this week. And one’s down today. A couple of them are down Friday. So the packer is trying to do whatever is necessary to not have to chase the market anymore,” he adds.

That was already a pressuring feature for the market on Friday.

High Gas, Stock Market Sell Off
Also working against the cattle market was the surging gas prices and the sharply lower stock market.

At some point that becomes negative for consumer demand. “One has the worry that, you know, and the inflation or the stress on the budget that’s created by that. And let’s be honest. I mean, boxed beef is no runaway with this tight kill. And it is less than a week now till Mother’s Day. We’re already past that. Usually two weeks ahead of Mother’s Day. That’s kind of your signal for let’s begin the middle meat rally. So hopefully it
still develops. But I think. There was some of that going on today,” he says.

So that created some technical selling especially with the funds nearly record long.

DOJ Probe
Adding to the bearish attitude was USDA Secretary Brooke Rollins reiterating the goal of the Trump administration to get beef prices down.

Part of that strategy includes a Department of Justice investigation of the beef packing industry.

He says, “I’m not sure that Secretary Rollins commentary this morning was helpful to the market either, bringing up the concept of investigating the big four. You know, probably if you’re an algorithm trader and you’re trading, you might think, you know what, I don’t think I want to be participating in this kind of uncertainty.”

DOJ has probed the packing industry in the past only to walk away empty handed but it spooked the funds.

“There’s things that have happened historically that deserve some looking into including the Holcomb fire. I was very vocal through that period about how we killed more cattle after the fire than before it but they couldn’t see anything wrong then. You know, I mean, we had 85 cent cattle and $450 boxes. So, you know, so what are they going to find now?”

Hogs Down Again
Lean hog futures were down again on Monday with continued fund liquidation and technical selling.

Kooima says the market got spooked about the pseudorabies case in Iowa on Thursday and Friday.

He was hopeful with the positive comments Iowa Secretary of Ag Mike Naig made about the problem being contained that the market would stablize.

“He outlined how everything got tested. These were five boars from Texas and an isolated incident. We’ve got protocol in place and we haven’t had a case since 2004. I was hoping that maybe cooler heads would prevail,” he adds.

Kooima says the cash news is pretty friendly but the market can’t find support and the charts look terrible.

“The inability to source pigs because of the disease problems is real. What these pigs cost, close to $100 on an isowean, $150 on a 40-pounder, would tell you just how tight the supply is. So, you know, I have a tendency to be a little bit of a supply-side bull here with nothing to show for it.”

Soybeans Break to Fresh Highs
Soybeans ended 16 to 21 cents higher on Monday and made new highs for the move in both old and new crop contracts.

The market was following bean oil which made more new contract and multi-year highs once again chasing higher crude oil.

The market was also building in optimism ramping up into the trade summit next week in China.

“The hope that we get something tangible with this China visit. I would caution everybody be a little careful as this is China. They’re a bit disingenuous and not the most reliable trade partner but that is out there,” he states.

The crude oil/bean oil story is also a drive as he says with higher energy prices there is the fear of inflation.

“I think is reflecting in some of our commodity prices here, too, most notably some of the stuff that is relatively cheap, like the grains are,” he adds.

How High Will Soybeans Rally?
With the chart breakout will July soybeans be able to take out the March high of $12.50 3/4 and will November soybeans get above $12?

Kooima says both of those moves are in the cards. “Based on the chart pattern here and the fact we have broke out of the range we have been in for six or seven weeks. When you break out of those consolidation patterns that it’s like coiling a spring. I always think the tighter it’s wound then the bigger reaction you get. So, this thing actually projects through that old $12.50 area on the July beans which is a big deal. On both the
weekly chart and on the daily chart it actually opens up the path here for a move to $12.70 or even maybe even closer to $13 on the old crop.”

That could put November in the $12.40 to $12.50 price range where he would suggest some marketing.

Corn Makes Fresh Highs, Dec Closes Above $5
Corn also made fresh highs for the move in sympathy with soybeans and on fund buying.

Funds bought over 80,000 contracts and could add to that Kooima says.

“You don’t have to be a genius to look at $4.85 to $4.87 on the July corn to know how important that is. Let’s see if we can take that out. December corn, you know, that’s new highs for the move. Nice looking chart pattern. We are kind of overbought here. I don’t know if we need to rest just a little bit. But, you know, incrementally, I was starting to look at some new crop sales here. And then the next level at around $5.20. And then the next one around $5.45. I’m more inclined to sell into the corn rally.”

He says the market is also watching weather, lower acreage and fertilizer concerns plus whether or not China buys corn at the summit.