Thursday Morning Livestock Market Update - Another Ban on Cattle Movement

GENERAL COMMENTS:

News about the New World screwworm has been a daily occurrence. Canada banned the importation of Texas cattle and now Mexico has joined them. Mexico is halting most livestock imports from the United States, including cattle, pigs, and sheep. There is not much livestock that moves from the U.S. to Mexico, but the ban has been implemented. So far, the market has digested the news of the past week and decided it was not bearish. The bearish aspect would be if beef demand were to decline. Cash cattle have not traded so far this week, as feedlots have not jumped to sell cattle aggressively due to the news. The expectation is for cash to trade steady to higher. Boxed beef prices were mixed on Wednesday, with choice up $0.38 and select down $1.23.

Hog futures moved higher as traders may have tried to bottom-pick the market due to it being near support. Early strength ran out of steam with most contracts making new lows, but avoided closing below support. Friday is the last trading day for June hogs, with the price closing near the low last seen Nov. 24, 2025. The downtrend has been brutal since futures topped on March 4. Packers remained aggressive on Wednesday with the National Daily Direct Afternoon Hog report up $0.04. Packers are not expected to be aggressive the rest of the week. Pork cutout values remained unchanged from Tuesday. Weekly hog weights averaged 289.4 pounds. The USDA will release the WASDE report at 11 a.m. CDT Thursday, which will show its estimates for average quarterly prices into next year.

	BULL SIDE		BEAR SIDE
1)	Traders have not turned bearish and liquidated positions due to the New World screwworm being discovered in the U.S.	1)	Packers may not need to be aggressive with cash purchases this week and may not raise their bids. Feedlots may need to lower offers to move cattle.
2)	Feedlots have not panicked and sold cattle this week, but may hold for steady-to-higher cash.	2)	Cattle futures may be developing a sideways pattern for the near term. A return to the highs may be difficult to achieve.
3)	Hog futures are oversold and prices near support may trigger short-covering.	3)	Weekly hog weights are 2.2 pounds higher than a year ago. Increased slaughter provides significantly more pork for consumers.
4)	Weekly hog weights declined one pound from the previous week, averaging 289.4 pounds.	4)	If futures break through and close below the November support, they could make another leg lower.

Wednesday Closing Livestock Market Update - Mixed Tones Again Follow the Complex

GENERAL COMMENTS:

It was yet another day for the livestock complex, where the cattle contracts rallied mildly while the hog contracts struggled to gain support. No cash cattle trade developed throughout the day. Do note that the monthly WASDE report is scheduled for release on Thursday. July corn is down 1/2 cent per bushel and July soybean meal is up $0.80. The Dow Jones Industrial Average is down 881.97 points and the NASDAQ is down 464.74 points.

LIVE CATTLE:

The livestock contracts ended the day stronger as traders were willing to advance the contracts mildly but weren't quite confident enough in the market's position to rival its resistance at the 40-day moving average threshold. June live cattle closed $2.07 higher at $250.10, August live cattle closed $1.80 higher at $241.50 and October live cattle closed $1.57 higher at $233.70. No cash cattle trade developed throughout the day, and no bids were offered either. Asking prices are noted at $258 to $260 in Texas, but are not established in other regions. 

Wednesday's slaughter is estimated at 105,000 head -- 1,000 head less than a week ago and 5,000 head less than a year ago.

Boxed beef prices closed mixed: choice up $0.38 ($393.28) and select up $1.23 ($375.70) with a movement of 107 loads (68.19 loads of choice, 13.93 loads of select, 9.55 loads of trim and 15.44 loads of ground beef).

THURSDAY'S CATTLE CALL: Steady. Given that feedlot managers didn't jump at the early bids offered in Nebraska on Wednesday, I'm led to believe that feedlot managers believe that packers are still in need of more cattle and that they should be able to successfully hold the market steady, if not even advance it mildly.

FEEDER CATTLE:

And again today, with the support of the live cattle contracts higher trend and a tick more interest in the countryside for feeders and calves, the feeder cattle contracts were also able to end the day stronger. August feeders closed $0.22 higher at $354.37, September feeders closed $0.67 higher at $351.37 and October feeders closed $0.82 higher at $347.72. At the OKC West Livestock Auction in EL Reno, Oklahoma, compared to last week, feeder steers over 750 pounds sold $6.00 to $12.00 higher, but steers under 750 pounds traded $15.00 to $20.00 higher. Feeder heifers sold $5.00 to $10.00 higher. Steer calves traded $5.00 to $15.00 stronger, and heifer calves sold steady to $5.00 stronger. Feeder cattle supply over 600 pounds was 81%. The CME feeder cattle index 6/9/2026: down $0.14, $368.06.

LEAN HOGS:

Try as it might, the lean hog complex just wasn't able to muster up enough support to push all the contracts higher by Wednesday's end. The spot July contract and nearby August contract closed higher, but without enough concrete fundamental support in the complex, the rest of the contracts fell lower through the day's close. July lean hogs closed $0.70 higher at $96.85, August lean hogs closed $0.72 higher at $95.42 and October lean hogs closed $0.17 lower at $80.82. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.04 with a weighted average price of $97.52 on 4,693 head. Pork cutouts totaled 353.00 loads with 306.02 loads of pork cuts and 46.97 loads of trim. Pork cutout values: unchanged, $95.96. Wednesday's slaughter is estimated at 477,000 head -- 1,000 head less than a week and a year ago. The CME lean hog index 6/8/2026: up $0.13, $92.76.

THURSDAY'S HOG CALL: Steady. Packers have been more aggressive in this week's cash market, which likely means that they were short bought coming into the week. Now, whether or not they need more hogs on what they've already purchased remains unknown.

Cattle updates - Price strength persists, drought risk builds

Tight cattle supplies and strong consumer demand continue to support historically strong market conditions, though drought risk is escalating. Pasture conditions and hay production will be key drivers of cattle production capacity heading into 2026.

As of May 26, 60% of U.S. cattle regions were in drought, up sharply from 37% a year earlier. Within AgWest states, Arizona, Idaho, Oregon, and Montana face some of the most severe conditions, while California and Washington remain comparatively manageable. In contrast, drought is intensifying across major production areas in the Central and Southern Plains, where 52% of Oklahoma, 65% of Texas, and 75% of Nebraska cattle regions are classified in D2 (severe) drought or worse. While a transition to El Niño may improve moisture conditions in key central regions, the West is expected to remain hot and dry, posing ongoing challenges for forage production and limiting herd expansion.

With rising drought concerns and water cutbacks, hay production is likely to be constrained, keeping forage costs elevated. In response, cow-calf producers in Idaho and Montana have already begun purchasing hay, contributing to recent price increases. (See the hay update for additional details.) In contrast, corn supplies are projected to remain adequate. Prices are stabilizing in a moderate range that will support feedlot cost-of-gain.

The lack of carrying capacity won’t be conducive to herd expansion and points to continued cattle supply constraints. Domestic inventories have contracted significantly from the 2019 cycle peak, with total cattle numbers down roughly 8–9% and the beef cow herd down about 12–13%.

U.S. beef production has remained resilient despite tight domestic cattle supplies. The industry has partially offset lower slaughter volumes through heavier carcass weights, adding an estimated 200+ million pounds of production in 2025 compared to the previous year. Carcass weights remain elevated in 2026 and are expected to continue supporting overall output. However, these larger animals are creating processing challenges, as not all slaughter facilities are equipped with the infrastructure needed to handle increased carcass size. At the same time, the expansion of beef-on-dairy cattle has strengthened the supply base, now accounting for more than 12% of fed cattle production. One emerging downside risk is the New World screwworm; despite extensive mitigation efforts, a confirmed case in Texas on June 3 marks a meaningful escalation in the threat to U.S. cattle supplies.

Consumer demand for beef remains consistently strong, supported by its enduring role in protein consumption despite normal market cycles. While higher prices have not significantly weakened demand, consumers and retailers are placing greater emphasis on meat quality and grade, influencing purchasing behavior and shaping how producers raise and finish cattle. Going forward, rising household cost pressures may limit further price gains, leading to a more stable demand environment.

Cattle prices are expected to remain historically strong but may face some near-term pressure. Fed cattle prices have recently reached record highs, though seasonal patterns suggest potential softening later in the year. While tight supply fundamentals should provide ongoing support, prices may face headwinds from seasonal trends, rising cost constraints, and broader market volatility.

Profitability

Cattle feeders: Slightly profitable - Neutral 12-month outlook
Cow-calf producers: Very profitable - Neutral 12-month outlook

Strong fed cattle prices and heavy carcass weights have helped offset higher feeder cattle costs.

Record-high calf prices, driven by historically tight cattle supplies and strong beef demand, have more than offset elevated production costs.

Wednesday Midday Livestock Market Summary - Contracts are Higher With Ample Trader Support

GENERAL COMMENTS:

After a mixed start to the week, the livestock contracts are higher heading into Wednesday's noon hour as traders pour extra support into the marketplace. NO new cash cattle trade has developed and currently no bids are on the table. July corn is steady and July soybean meal is up $0.40. The Dow Jones Industrial Average is down 568.88 points and NASDAQ is down 284.22 points.

LIVE CATTLE:

Live cattle futures are rallying modestly into Wednesday's noon hour as the market is hopeful fundamental support is going to arise later in the week. It will be interesting to see how traders handle this afternoon -- along with Thursday's open -- as the contracts are nearing resistance and could grow weary of pushing higher if fundamental support doesn't develop immediately. June live cattle are up $1.95 at $249.97, August live cattle are up $1.85 at $241.55 and October live cattle are up $1.82 at $233.95. The cash cattle market is quiet at this point with no bids currently on the table. On Tuesday some bids were offered in Nebraska at $403 -- but no cattle traded. Asking prices are noted in Texas at $258 to $260.

Boxed beef prices are higher: choice up $1.91 ($394.81) and select up $0.92 ($377.85) with a movement of 63 loads (36.82 loads of choice, 6.29 loads of select, 8.37 loads of trim and 11.20 loads of ground beef).

FEEDER CATTLE:

Feeder cattle future's upward movement Wednesday is somewhat expected given the live cattle contracts are trading higher. August feeders are up $0.87 at $355.02, September feeders are up $1.30 at $352.00 and October feeders are up $1.35 at $348.25. Unlike the live cattle contracts, the feeder cattle contracts are further away from their resistance which means the market should be able to trade higher with ease if traders continue to believe that's the way the market should go.

LEAN HOGS:

After trading lower for four days in a row, the lean hog complex may have found some support as currently its contracts are higher. July lean hogs are up $1.20 at $97.35, August lean hogs are up $1.15 at $95.85 and October lean hogs are up $0.52 at $81.52. It is worth noting that, along with finding technical support this morning, the contracts are also pleased to see a slight uptick in pork demand.

The projected CME Lean Hog Index for 6/9/2026 is up $0.16 at $92.92, and the actual index for 6/8/2026 is up $0.13 at $92.76. Hog prices are higher on the Daily Direct Morning Hog Report, up $0.18 with a weighted average price of $97.35, ranging from $90.00 to $98.00 on 1,768 head and a five-day rolling average of $96.38. Pork cutouts total 185.12 loads with 159.64 loads of pork cuts and 25.48 loads of trim. Pork cutout values: up $0.69, $96.65.