5/19/26 Market Commentary

Live Cattle: Live Cattle futures finished the day higher with the June contract and the far out deferred contracts leading the way. Last week’s sharply higher cash market along with optimism for this week’s trade have the June contract continuing to push higher. Cash averages for last week were significantly higher in the Northern regions than in the South. The South traded cattle earlier in the week before the higher money in the North was available. The Nebraska weighted average set a new all-time high for all regions at 263.72. There have been no bids up to this point of the week but feedlots will be looking for higher money compared to a week ago. Boxed beef was higher this morning with choice being quoted $3.61 higher at $395.75 and select up $3.65 to $393.88. It is interesting to note that prime grades hold just a small premium to choice while the choice/select spread continues to trade on both sides of even. Last week’s CFTC Report showed the funds as sellers of 11,079 contracts for the week ending on Tuesday. This brings their net long position to 130,886, down from the highest level the market had seen since setting the record of 156,909 in 2025. The USDA will release their monthly Cattle on Feed Report on Friday at 2 p.m. Estimates are for cattle on feed to be up 1.6% compared to a year ago and marketings to be down 9.3%.

Feeder Cattle: Feeder Cattle futures led the entire cattle complex higher today after opening significantly lower and touching the 100-day MA seconds after the open this morning. Technical buying from the managed money sector appears to be the reason for the rally today along with the Corn market cooling off from its 20 cent gains from Monday. The CME Feeder Cattle index was quoted $1.83 higher today at $369.46. The May contract expires this Thursday at noon and is essentially right in line with the current index with just two days to go. The futures appear to be stuck between the 100-day MA as a support line and the 20-day MA as a resistance line. A breakout of either of these lines will most likely set the direction going forward and determine the next large move within the Feeder Cattle complex. Estimates for Friday’s Cattle on Feed Report are for placements to be up 4.6% compared to a year ago. The placement number will be something to watch going forward as dryness across the western and southern states persists, forcing ranchers to sell cattle.

Lean Hogs: Lean Hog futures finished lower for the fourth day in a row and posted new lows for the move today. The managed money have turned into sellers of the contract after spending the beginning of the year pushing the futures market to new contract highs on a weekly basis. The deferred contracts have not seen the decrease that the nearby contracts have and are only a few dollars from their contract highs. There is hope that China will begin buying U.S. pork in sizable amounts after this weekend’s news of a trade deal. The market will most likely look for the exports to be reported before any premium is built into the market. The pork cutout moved to the highest levels since April 28 yesterday and was quoted $0.80 higher at $98.36. The national cash average is also higher and is $1.11 higher than a week ago.

Corn: The grain markets leveled out on Tuesday after a significant move higher during Monday’s trade. Sunday night the White House announced that China made an agreement to purchase at least $17 billion is U.S. agricultural goods over the next three years. This was in addition to the committed 12 million tons of soybean purchases that China made earlier this year. China has yet to confirm these proposed purchases or agreements which will have traders cautious until more information becomes available. The July Corn contract finished over 20 cents higher on Monday, while open interest was down 12,000 contracts. This showed short fund liquidation and lack of farmer selling as most producers have their next sell targets near the old high of $4.87. Planting progress continues to move forward with both Corn and soybean planting ahead of the five-year average. This is much needed as rain forecasts continue to show moisture across the Corn Belt.