Cattle futures stepped confidently higher Monday, buoyed by Friday’s Cattle on Feed report with placements 9.2% less year over year and 6.5% less than pre-report estimates with snug supplies ahead (see below).
Toward the close, Live Cattle futures were an average of $5.06 higher. Feeder Cattle futures were an average of $8.31 higher.
Negotiated cash fed cattle trade was inactive on light demand in the North through Monday afternoon, according to the Agricultural Marketing Service.
Last week, FOB live prices were mostly $1 lower in Nebraska at mainly $222-$223/cwt. and mostly steady to $1 lower in the western Corn Belt at mainly $222. Dressed delivered prices were mostly steady at mainly $350.
The weekly weighted average FOB live fed steer price was 95¢ less at $221.87. The weighted average dressed, delivered fed steer price was 56¢ lower at $350.15.
Choice boxed beef cutout value was $4.41 higher Monday afternoon at $376.35/cwt. Select was $2.51 higher at $355.77.
Grain and Soybean futures were higher Monday, with apparent optimism for this week’s scheduled trade talks between the U.S. and China.
Through late afternoon, and through the front four contracts, Soybean futures were 20¢ to 23¢ higher. Corn futures were 13¢ to 15¢ higher. Kansas City HRW Wheat futures were 8¢ to 10¢ higher.
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Major U.S. financial indices closed higher Monday, as crude oil prices and Treasury Yield rates declines. AI-related stocks also added support.
The Dow Jones Industrial Average closed 366 points higher. The S&P 500 closed 114 points higher. The NASDAQ was up 599 points.
Through mid-afternoon, West Texas Intermediate crude oil prices (CME) were $1.63 to $4.74 lower through the front six contracts.
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Although feedlot inventories Sept. 1 were higher year over year, according to Friday’s Cattle on Feed report, maintaining inventories will be increasingly difficult going forward, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University.
“Feeder supplies are expected to tighten into 2027 with a smaller calf crop,” Peel explains in his weekly marketing comments. “Resumption of Mexican cattle imports may relieve some of the pressure, at least regionally. Delayed beef cow culling the past three years means that more replacement heifers will be needed just to stabilize the cow herd with additional heifers needed for any potential herd rebuilding. The feedlot marketing rate may stay low but is unlikely to keep dropping as it has in the past 18 months. In that case, lower placements will push feedlot inventories lower in the coming months.”
For perspective on the current cattle cycle, Peel explains the calf crop peaked in 2018 at 36.29 million head. It has declined for eight consecutive years since then, with this year’s calf crop estimated at 32.5 million head, down 3.79 million head from the cyclical peak.
However, he notes cattle on feed inventories have remained relatively high, peaking in September 2022 and then declining to a recent low of 11.4 million head in April of this year, which was 480,000 head fewer or just 4% less.
“Feedlot inventories have remained elevated due to a slow marketings rate,” Peel says. “The feedlot marketings rate – the percentage of inventory marketed each month – was at 16.0% in July 2023, having averaged 16.0% since 2018. The average marketings rate began declining and dropped below 15.0% in October 2025. The 12-month average marketing rate in August 2026 was a record-low 14.1%. The low marketing rate has even allowed on-feed totals to be higher year over year for the last five months. The sharp decrease in placements in July and August likely means that feedlot inventories will drop below year-earlier levels soon and for the foreseeable future.”
The slower marketing rate, mostly accomplished by feeding cattle longer, also has driven average carcass weights significantly higher. For instance, average year-over-year steer carcass weights were 23 pounds heavier in 20024, 24 pounds heavier in 2025 and are 32 pounds heavier so far this year, according to Peel.
“From 1960-2022 the average annual increase in steer carcass weights was 4.0 pounds per year. Though there have been individual years of significant increase in carcass weight, there have never been multiple years of much heavier carcasses,” Peel says. “The roughly 75-pound increase in steer carcass weights in the last three years is equivalent to the increase over the previous 18 years.
“The dramatic increase in carcass weights has also resulted in sharply decreased average yield grades. Recent data shows that the average Y4/5 percentage for the past 12 months is 29.2%, more than double the rate just six years ago.”
Listen to more of Peel’s insights here.