Cattle futures extended losses Thursday with likely technical selling, profit taking and positioning ahead of Friday’s monthly Cattle on Feed report.
Toward the close, Live Cattle futures were an average of $2.21 lower. Feeder Cattle futures were an average of $3.71 lower.
Negotiated cash fed cattle trade was limited on moderate demand in the Southern Plains through Thursday afternoon, according to the Agricultural Marketing Service. Although too few transactions to trend, there were some early FOB live trades at $248/cwt. Prices last week were mostly $246 in the Texas Panhandle and $246-$249 in Kansas on a light test.
Trade was light to moderate on moderate demand in Nebraska with dressed delivered prices steady to $1 lower at $388. FOB live prices there last week were mostly $248-$249.
Trade in the western Corn Belt was light on moderate demand with steady FOB live prices at $248. Dressed delivered prices there last week were mostly $388.
Choice boxed beef cutout value was 41¢ lower Thursday afternoon at $381.57/cwt. Select was 10¢ lower at $378.48.
Grain and Soybean futures were mixed Thursday.
Toward the close, and through near Dec contracts, Kansas City HRW Wheat futures were 12¢ to 19¢ higher supported by worries about the winter wheat crop. Corn futures were 1¢ to 2¢ lower. Soybean futures were mostly 2¢ to 4¢ lower.
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Major U.S. financial indices closed higher Thursday, buoyed by what investors deemed as progress in resolving the war with Iran.
The Dow Jones Industrial Average closed 115 points higher. The S&P 500 closed 18 points higher. The NASDAQ was up 86 points.
Through mid-afternoon West Texas Intermediate Crude Oil futures (CME) were 5¢ to $2.31 higher through the front six contracts.
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With continued underlying market fundamentals of tight cattle supplies and strong consumer beef demand, the downside risk emerges from the negative margins in the meatpacking and cattle feeding sectors, according to Stephen Koontz, agricultural economist at Colorado State University.
“Packer margins – the revenue from beef and byproduct sales less the cost of finished cattle – spent all but four months of 2025 below $200 per head,” Koontz says, in the latest issue of In the Cattle Markets. “These gross margins were negative in February 2026 – the amounts paid for fed cattle were greater than the amount for which beef and byproducts were sold. Margins did bounce back in March 2026, but to just short of $250 per head. These margins are what packing companies need to pay for labor, facilities, supplies, equipment, and management. Reasonable estimates of packer per head slaughter and fabrication costs are between $285 and $365 per head – on every head. Packer losses through 2025 and into 2026 will result in facility closings. This has occurred but will continue. And this is not good news for the cattle industry.”
As for cattle feeding, Koontz points out estimated cash returns were strong last year and heading into this year, but are offset significantly by hedging losses, which are not publicly available. For perspective he explains, using deferred Live Cattle contract prices to estimate revenue and nearby Feeder Cattle and Corn contract prices to estimate costs, hedging opportunities for cattle feeders the remainder of this year pencil out to $100 to $300 lost per head.
“This downstream margin trouble is long-term trouble – excellent cattle prices now with much asset and investment risk and volatility in the future,” Koontz says. “Or will there be some creative business models that are constructed to create better long-term opportunities with less boom and bust in the different segments of the beef supply chain?”