Monday Morning Livestock Market Update - Exuberance of Cattle Traders May Be Tempered

GENERAL COMMENTS:

Light cash cattle trade developed late on Friday as packers needed to pay up to purchase what was necessary to maintain slaughter. Cash cattle were reported at $4.00 higher in Nebraska. There were some reports of packers purchasing cattle on Saturday at $1.00 to $2.00 higher in the South. It will be an interesting week as packers have not purchased many over the past two weeks. Feedlots will hold with the intent to obtain higher prices, anticipating that packers will need cattle. Live cattle broke out of its sideways trading range, while feeder cattle easily pushed higher to close the next chart gaps that had remained above the market. This sets a bullish tone for the year. Boxed beef prices supported the move, with choice up $2.52 and select up $4.54.

Hog futures diverged with weakness in the nearby contracts as the weakness of cash is limiting the upside price potential. Traders are concerned that more hogs will be available to the market in early 2026, with demand possibly unable to absorb the increased pork supply. However, as the market returns to normal after the holiday season, a clearer picture of supply and demand will be seen. On Friday, the National Daily Direct Afternoon Hog report showed cash down $0.19 with very few hogs traded. Pork cutouts gained $0.83. Retail orders may be evident early in the week as they stock up after the holidays.

	BULL SIDE		BEAR SIDE
1)	The surge in cattle futures renewed the bullishness in the market and may provide confidence to traders for higher prices.	1)	The surge in cattle futures on Friday may have been excessive and was fueled by lighter trade volume.
2)	Feedlots will hold for higher cash as packers have not purchased many cattle over the past two weeks. They may need to step up aggressively.	2)	Feedlots have been holding cattle over the past two weeks and may need to move them rather than feed them for another few weeks. They may be willing to sell at a steady cash price.
3)	Pork cutouts may see strength as retail outlets restock pork after the holidays. Pork movement may have been better than expected.	3)	The supply of hogs that are ready for the market may be large, keeping cash prices under pressure in the near term.
4)	Later hog futures continue to make new contract highs as optimism remains over pork prices during the second half of the year.	4)	Nearby hog contracts fell below the uptrend line on Friday, which may open the door for further liquidation of futures contracts.

Friday Closing Livestock Market Update - Cattle Futures Start 2026 Sharply Higher

GENERAL COMMENTS:

Even though the livestock complex entered the new year officially mixed following losses in hog prices and strong gains across the cattle complex, the focus on very-active price support in both live cattle and feeder cattle trade seemed to steal the attention of the entire market. Live cattle contracts were led higher by spot-month contracts trading over $4 higher, while most feeder cattle trade pushed prices $7 to $8 per cwt higher by the end of the session. Limited trade was seen during the holiday week, but it looks like an active beginning for 2026. Hog futures were lightly traded, with spot contracts holding $1 per cwt losses heading into the weekend. Hog prices closed lower on the Daily Direct Afternoon hog report, down $0.19 with a weighted average of $70.19 on 316 hogs. March corn closed down 2 3/4 at $4.375 and March soybean meal closed down $3.40 at $296. The Dow Jones Industrial Average is up 319.10 at 48,382.39.

For the week ending: 1/2/26

From Friday-to-Friday livestock futures scored the following changes: February Live cattle up $6.18, April Live cattle up $6.28; January Feeder cattle up $9.93, March Feeder cattle up $12.53; February Lean hogs off $0.42, February Lean hogs off $0.42; February Pork cutout off $0.00, April Pork cutout unchanged.

LIVE CATTLE:

Live cattle futures surged higher Friday with active buyer support flooding the market following the holiday break. Spot-month February futures led the market, pushing prices $4.40 per cwt higher and closing at $236 per cwt. The aggressive market move broke through the 100-day moving average and is at the highest price level since the last week of October. The current premium in the spot-month live cattle contract continues to focus on the tight supplies and also accounts for a $29 per cwt rally in the last six weeks. Although the tone of the market is expected to remain supportive through early January, there is uncertainty as to just how much additional buyer activity will develop early next week following these late-week and holiday impacted trade shifts seen Friday. Cash cattle markets remain relatively quiet Friday afternoon with light trade reported in parts of Nebraska with dressed sales marked at $360, $4 higher than last week's weighted average. Bids in the South are now around $232, but so far they are being passed as they remain a couple of dollars below current asking prices of around $234. February live cattle closed $4.40 higher at $236., April live cattle closed $3.78 higher at $235.975 and June live cattle closed $3.58 higher at $230.35. 

Boxed beef prices closed higher: choice up $2.52 ($349.97) and select up $4.54 ($346.92) with a movement of 85.15 loads (59.11 loads of choice, 4.37 loads of select, 5.55 loads of trim and 16.12 loads of ground beef).

MONDAY'S CATTLE CALL: Steady to $1 Higher. Momentum in both futures trade and cash market developments over the holiday week seem to be sparking further support. This should help solidify asking prices early Monday as both sides get back to a much more normal routine following the end of year holidays.

FEEDER CATTLE:

Feeder cattle futures quickly led not only the livestock market higher but became the focus across most commodity markets with aggressive triple-digit gains flooding into the market after the New Year's holiday. The aggressive start to all nearby feeder cattle contracts put the focus on current price levels well above 100-day moving averages and solidifying expectations of additional market support in the new year. The focus on continued tight feeder cattle supplies and beef demand that is not expected to slow in the near future is helping create aggressive buyer support in all nearby contracts. March through November contracts posted gains of $7 per cwt or greater during Friday's trade. Feeder cattle sales have been sluggish through the holiday season, but additional interest is expected to quickly develop early next week. January feeders closed $5.85 higher at $356.1, March feeders closed $7.63 higher at $352.95 and April feeders closed $8.03 higher at $352.25. The CME Feeder Cattle Index for December 30: up $1.78, $350.22.

LEAN HOGS:

Lean hog futures eased Friday following the holiday break. But to be fair for the overall lean hog complex, limited focus was seen in the hog market or most other markets other than the exploding cattle complex Friday. With feeder cattle contracts moving with rocketlike speed, and live cattle markets quickly trying to keep pace, the focus in early 2026 has little to do with hog market fundamentals. It is expected there may be some additional traction in the hog complex over the next week associated with additional moves in the cattle complex. But for the most part, lean hog trade is expected to hold to current trading patterns in the near future. February lean hogs closed $1.00 lower at $84.1, April lean hogs closed $0.80 lower at $89.1 and May lean hogs closed $0.63 lower at $93.375. Friday's hog slaughter is estimated at 391,000 head, 221,000 head more than a week ago and 77,000 head less than a year ago. Pork cutouts totaled 177.55 loads with 143.40 loads of pork cuts and 34.15 loads of trim. Pork cutout values are up $0.83 at $94.57. The CME Lean Hog Index for December 30: up $0.01, $82.26.

MONDAY'S HOG CALL: Steady. Hog buyers will be back in full swing early next week, needing to secure numbers for full production schedules over the next couple of weeks. The holiday-shortened processing and trading weeks are now in the rearview mirror and both sides are likely to be focusing on moving market-ready hogs in the upcoming days.

Friday Midday Livestock Market Summary - Cattle Launch Higher as Live and Feeder Contracts Surge

GENERAL COMMENTS:

The livestock complex is trading mixed as the cattle contracts launch higher while the hog complex is mixed. Some light cash cattle trade has been reported in Nebraska at $360, which is $4.00 higher than last week's weighted average. March corn is down 2 1/4 cents per bushel and March soybean meal is down $2.70. The Dow Jones Industrial Average is up 182.66 points and NASDAQ is down 19.07 points.

LIVE CATTLE:

It's a breakout day for the live cattle complex as the market has shot above its 100-day moving average for the first time since late October. February live cattle are up $3.30 at $234.87, April live cattle are up $2.95 at $235.12 and June live cattle are up $2.90 at $229.67. More than anything, it seems to be a combination of trade support mixed with the knowingness that demand is likely only going to get stronger through the first half of the year, with traders also noting the uptick in cash cattle prices today. A few dressed sales are being reported in Nebraska at $360, which is $4.00 higher than last week's weighted average. Several majors in that state are also bidding $360, but those bids continue to be passed. A few bids are on the table in the South around $228 to $232, but they are being passed as they are below current asking prices of around $234. Packer inquiry should continue to improve as the day progresses.

Boxed beef prices are higher: choice up $1.25 ($348.70) and select up $4.56 ($346.94) with a movement of 53 loads (36.70 loads of choice, 2.70 loads of select, zero loads of trim and 13.41 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is also sky-rocketing higher as traders note the uptick in the live cattle complex and continue to be optimistic that the market is likely going to trade stronger and stronger through at least the first quarter of 2026. January feeders are up $5.05 at $355.30, March feeders are up $6.27 at $351.60 and April feeders are up $6.82 at $351.05. Feeder cattle sales next week will likely be stronger in the countryside as well.

LEAN HOG:

The lean hog complex is trading mixed into Friday's noon hour as the nearby contracts dip lower while the deferred contracts continue to trade higher. More than anything, traders seem reluctant to do much with the contract until its fundamentals improve. February lean hogs are down $0.87 at $84.22, April lean hogs are down $0.72 at $89.20 and June lean hogs are down $0.42 at $102.45.

The projected lean hog index for 12/31/2025 is down $0.41 at $81.85, and the actual index for 12/30/2025 is up $0.01 at $82.26. Hog prices are on the Daily Direct Morning Hog Report are unavailable due to confidentiality. However, we can see that only 171 head have traded and that the market's five-day rolling average now sits at $69.40. Pork cutouts total 82.06 loads with 64.41 loads of pork cuts and 17.65 loads of trim. Pork cutout values: up $1.97, $95.71.

Friday Morning Livestock Market Update - Steady Cash Cattle Trade Expected

GENERAL COMMENTS:

Traders did not liquidate their long positions to end the year, but instead maintained them due to renewed optimism over cattle prices. Cattle fundamentals remain bullish, providing traders with the confidence to remain long in the market. Cash cattle have not yet traded this week, but the expectation is for business today at steady prices compared to last week. Boxed beef prices have not indicated that they have found a bottom. Consumers have less disposable income and may reduce the demand for high-priced cuts of beef in the near term. Boxed beef prices on Wednesday showed choice down $0.75 and select down $0.78. The Commitment of Traders report is now up to date since the government shutdown. The fund traders increased their live cattle long positions last week by 3,727 contracts to a net long of 93,314. Feeder cattle showed an increase of 672 futures contracts, increasing the net-long positions to 15,198.

Hog futures show limited volatility, but continue to trend higher. The strength is the result of traders anticipating increased demand and a strong slaughter pace, which will keep hogs current. Underlying cash and cutout prices are not providing support, with limited strength expected in the near term. There were finally sufficient hogs purchased on Wednesday for packers to report prices. The National Daily Direct Afternoon Hog report showed cash down $0.19. Pork cutout values declined $0.39. It is unlikely packers will be aggressive today and will be able to purchase what they need without difficulty. The Commitment of Traders report showed the fund traders holding 72,177 long futures positions, up 12,164 contracts from the previous week.

	BULL SIDE		BEAR SIDE
1)	A steady cash cattle trade is expected today, which should maintain market support.	1)	The continued weakness of boxed beef indicates that demand has slowed. Consumers have less disposable income and are trying to stretch their food budget with less expensive forms of protein.
2)	Lighter trade volume today may allow futures to increase further into the weekend.	2)	Packers may be reluctant to bid higher for cattle and may have little need to be aggressive. Feedlots may decide to move heavier cattle rather than continue to feed them another week or longer.
3)	Fund traders continue to add to their long positions as the trend remains up, and the demand outlook for pork has improved.	3)	Both cash hogs and pork cutouts continue to flounder without consistent price support. This may limit the upside potential.
4)	The hog slaughter pace has been strong and is expected to remain that way, keeping market-ready hog supplies from backing up.	4)	The upward momentum in hog futures seems to be slowing. Traders will need confirmation of fundamental support to maintain the uptrend.