6/10/2025 Market Commentary

Live Cattle: The Live Cattle complex saw another volatile Tuesday as all months traded across a $3 range. No news came into the market to cause the big swings throughout the day, but many are pointing at ICE raids in packing plants in Omaha, Nebraska as the culprit. Today’s estimated kill is at 119,000 hd which is not suggesting any kill reductions on the day. There are a few plants that have canceled cattle in the North for tomorrow due to worries of lack of labor. It has become a theme over the last three weeks that news headlines and rumors break during trading hours on Tuesday. While noteworthy, this is definitely not something to hang your hat on or trade in anticipation of. Open interest within the cattle complex has decreased drastically over the last three days. At the close of trade on Thursday, open interest within the Live Cattle complex was nearly 417,000 contracts and declined to just 392,000 contracts as of the close yesterday. With option expiration day being last Friday, many contracts were offset with options exercising and expiring. Cash trade has been quiet so far this week, but there were a few cattle traded at 238 in Texas on Monday. Most feedlots are not sure where to price cattle as the cash market has traded sharply higher each of the past five weeks. Import and export data for April was released last week and showed large amounts of beef imports into the U.S. Total imports throughout the month of April are up 28% for 2025 while exports are down 4%. Imports from Brazil were up nearly 17% from the month of March and became the biggest source of beef, while exports to China fell to a 5-year low.

Feeder Cattle: Feeder Cattle futures posted new contract highs across all months on Tuesday as cash Feeder Cattle continue to move to new record levels. The CME Feeder Cattle index is now at $314.05 through Monday’s sales, a new record and $12.57 higher than a week ago. Nearly hard to believe, but with futures markets that are at record highs, cheap feed, and limited amounts of available feeder cattle, prices continue to rise. The managed money is currently long 34,827 contracts which is an all-time record. There has been no news from the Mexican border. The Cattle on Feed report next Friday will give the industry an update of placements and cattle on feed numbers in the southern states. As of May 1, Texas had 6% less cattle in feedlots compared to a year ago. With the closure of the Mexican border, that number does not look to improve in the near future.

Lean Hogs: Another day with plenty of support was seen within the Lean Hog complex today. All months with the exception of the nearby June contract traded near their highs that were posted on Monday, and July traded to a new high. The futures continue to follow the strong cash markets and the higher cutout. June futures will expire this Friday and remain a $4.10 premium to the Lean Hog index. Open interest continues to increase as the funds continue to add to their long position. As of last Tuesday, the managed money was long 101,626 contracts. Still a good distance from the record length of 133,507, but with the continued buying being seen within the complex, there should be a sharp increase reported this Friday.

Corn: Corn futures traded to new lows for the calendar year before finding support and finishing the day higher. The grain markets as a whole tried to stabilize last week but began this week under heavy pressure. There are too many factors that are weighing on the market, keeping prices depressed. Limiting factors for the move higher include a large South American crop, no currently threatening U.S. weather, no positive news on renewable fuels and the worries regarding demand from China. The USDA Crop Progress Report that was released yesterday afternoon showed corn planting at 97% complete. Ohio has been a big question and center of debate as planting has been slow due to wet weather, but the state is now 90% complete with corn planting. Corn conditions were increased 2% compared to a week ago and confirms the market’s thoughts of a corn crop that is off to a good start, along with favorable forecasts in the extended models. Estimates for Thursday’s WASDE report show no big surprises coming from the USDA. A slight reduction in carryout is anticipated.