5/30/2025 Market Commentary

Live Cattle: The cash market was sharply higher again this week as packers continue to compete for market-ready cattle. Cattle in the North mostly traded at 235 but there were some cattle that traded at 236. The South traded most of their fat cattle at 223. Basis continues to improve for the feedlots as cash is nearly $20/cwt over the June futures. The futures market traded higher on Thursday as the better cash market was taking place, but failed to see much follow through on Friday. The weakness within the futures market today could have been attributed to end of the month trading action, along with trading near contract highs early this morning. Boxed beef was higher again this week and is now at the highest levels ever, with the exception of the spring of 2020 when Covid created supply chain issues. Choice was up $4.20 this week to $365.99 and select was up $5.83 to $356.88. Slaughter data for the week ending May 17 was released yesterday and steer weights were down 7 lbs from the prior week and heifer weights up 2 lbs. Even with heavier carcasses than a year ago, beef production is down roughly 4% in the 2nd quarter of 2025 due to reduced slaughter rates. Open interest has climbed back above 400,000 contracts this week and is within reach of the yearly high of 408,273 that came at the beginning of April.

Feeder Cattle: Feeder Cattle futures surged through the 300.000 level again yesterday, but could not hold those gains throughout the day on Friday as all months settled back below 300.000. It feels like a futures market above 300.000 catches the eye of many traders and begins to bring the question of whether cash feeders and the CME Feeder Cattle index can get back and stay above that level for extended periods of time. The current index is 299.30 which was up 1.55 after Thursday’s sales. The managed money is currently long 33,258 contracts which is just short of the all-time record of 34,132. Open interest within the Feeder Cattle complex has not seen the wide volatility that the Live Cattle complex has, but the funds did not lighten their long position at the beginning of April to the extent of the Live Cattle either.

Lean Hogs: The pork cutout has moved higher after a stagnant six-day stretch. Quoted at $109.400, which is up $4.78 on this morning’s report, has given the Lean Hog futures new life and lead to new contract highs in the deferred months today. The nearby June contract is now $7.20 above the current Lean Hog index with just over two weeks remaining before expiration. The cash fundamentals continue to remain strong and are now all above a year ago. Iowa/Southern Minnesota hog weights this week were up 0.1 lbs compared to last week and are the same as a year ago, indicating the market is staying current. Open interest continues to climb as the managed money is adding to their long position. This week’s CFTC report show the funds long 94,540 contracts, which is an increase of 2,796 contracts from the prior week.

Corn: New crop corn futures finished lower every day this week and have erased nearly all of last week’s gains, and are now nearly 20 cents off the highs made last week. The chart picture has again turned bearish as there are no current weather threats to U.S. corn production this summer. Brazil is currently harvesting a very large crop and private analysts will release their estimates next week as to the actual size of production. Weather models have turned to a wetter-than-previously-expected month of June with no widespread stretches of heat. Exports were smaller this week but still well within the range. Rumors of cancellations for export sales have been circulating as tariff talks between the U.S. and China are not going as planned. President Trump has said China violated parts of the initial trade agreement that created the 90-day pause on most tariffs earlier this month. This could end the the pause in tariffs and the tariffs could be immediately reimplemented.