Commentary

Agriculture commodities finished the week under pressure as the Trump administration threatens tariffs on Mexico and Canada. Cash cattle trade was sharply higher in the south, while the north held together a fully steady week. Grain futures finished the week lower with concerns over tariffs and an abundance of bushels moving to end users. All eyes will be on announcements out of the White House this weekend that will set the stage for the beginning of the week.

Live cattle, feeder cattle, and lean hog futures are climbing, supported by strong cash markets, record-long positions, and tight supplies, with February live cattle futures up $16.950/cwt in 2025. Corn rebounded slightly after a two-day decline, helped by export sales and Argentina’s reduced export taxes, though cash basis weakens amid farmer selling.

Live cattle markets surged, with cash prices climbing to new highs and futures breaking records, driven by strong fundamentals and fund activity, while feedlot trade reached as high as $214/cwt. Feeder cattle and lean hog markets also showed strength, supported by record-long fund positions and higher cash values, while corn futures faced resistance near $5 amid increased global exports and rising ethanol production.

Live cattle futures began the shortened holiday week with a softer tone, as traders remain cautious about the sustainability of the current cash market, and consumer demand shows signs of weakening due to high meat counter prices. Feeder cattle cash markets appear to have plateaued, with weather and rising corn prices affecting bids, while lean hog futures saw early gains erased amid steady cash and product prices and favorable export conditions with Mexico.

Live cattle prices started the week with higher expectations but settled slightly lower due to futures’ inability to reach new highs, while average carcass weights rose above the three-year average. Feeder cattle markets remain strong with tight supplies and high demand, but questions persist about feedlot sustainability amid rising costs, and discussions around reopening the Mexican border for imports remain stalled, potentially impacting U.S. prices.