Thursday Morning Livestock Market Update - New World Screwworm Discovered in the US

The big news is the confirmed discovery of the New World screwworm (NWS) in the U.S. The following excerpt was taken from the APHIS screwworm.gov website.

"WASHINGTON, DC, JUNE 03, 2026 -- The U.S. Department of Agriculture's (USDA) Animal and Plant Health Inspection Service (APHIS) confirmed the detection of a New World screwworm (NWS) in a bovine in Zavala County, Texas. NWS is a serious pest that affects livestock, pets, wildlife, and less commonly, people and birds. NWS larvae (maggots) burrow into the flesh of living animals, causing serious damage to livestock and economic losses. The affected animal is a 3-week-old calf, and larvae were identified in its umbilical area."

It is uncertain how the trade will react to this news, as it was confirmed after the close. Liquidation will likely take place as a reaction to the news. The positive news is that light cash trade took place on Wednesday and was steady with last week. Boxed beef prices were mixed, with choice up $1.79 and select down $0.38.

Hogs posted another day of strength, which seems to be technical in nature. The market was oversold, and short covering took place. Traders also might have decided to bottom-pick the market, anticipating that futures may make a significant price correction. Fundamentally, the market continues to struggle with the National Daily Direct Afternoon Hog report showing cash down $1.21. They are not expected to be aggressive today. Pork cutout values fell by $2.08. The weekly hog weights declined to 290.4 pounds.

	BULL SIDE		BEAR SIDE
1)	The tight supply of cattle will remain. Sale barns are seeing an increased number of cattle due to the impact of drought in areas of cattle country.	1)	The discovery of the New World screwworm in Texas may trigger significant liquidation as traders react to the news.
2)	The initial cash cattle trade this week was steady with last week. This may provide support to the market.	2)	Packers may pull back on cash in anticipation of the weakness of the cattle market.
3)	Hog futures may see further short covering to correct the oversold status of the market.	3)	Hog futures may have limited upside potential if cash and cutouts are unable to find support.
4)	Weekly hog weights declined 0.7 pounds last week to average 290.4 pounds. Further declines usually take place in the summer.	4)	Weekly hog weights remain 2.1 pounds higher than a year ago. Increased slaughter results in an ample supply of pork.