1/16/2026 Market Commentary

Live Cattle: Live Cattle futures finished the week sharply lower, but did recover off of their lows for the day. This morning, rumors of a Screwworm case in the U.S. sent the futures market lower but once it was confirmed untrue, the futures rebounded but could not build any bullish momentum heading into the three-day weekend. Cash trade took place as the board was falling this morning. The North traded mostly at 230 to 232 on a live basis and 365 on a dressed basis while the South traded at 233. Many feedlots took advantage of the collapse of the futures market and traded cattle at a much better basis than has been available for quite some time. Depending on when cattle were sold today, there were cattle traded at a positive basis. Boxed beef continues to improve and both choice and select will finish higher for the week. This morning, choice was quoted at $361.91 which is $6.67 higher than last Friday and select is currently at $360.30, $8.85 higher than a week ago. The concern within the cattle complex continues to be the stagnant cash markets and the fears of heavy cattle are becoming a reality. With the sideways cash market and undesirable basis, feedlots had been holding cattle. For the week ending January 3, steer and heifer carcass weights were 7 pounds higher than the previous week and 27 pounds heavier than a year ago.

Feeder Cattle: Feeder Cattle futures pushed to limit lower multiple times today as the market traded the fears of Screwworm being found in the United States. Those rumors were eventually extinguished but the futures damage had already been done and the futures failed to sustain moves back higher heading into a three-day weekend. No markets on Monday prevented buyers from entering the market in case there is more news over the weekend. The CME Feeder Cattle index continues to move higher and is back above the $370 mark for the first time since October 23. Salebarns across the country continue to set new records for all classes of Feeder Cattle as feedlots and backgrounding yards fill their pens. The lower cost of corn has helped the Feeder Cattle market, but demand has been the driving force.

Lean Hogs: Lean Hog futures have finished higher four days in a row and all contracts except the nearby February contract posted new contract highs today. The national cash average is $10.92 higher compared to last Friday and has been the main reason for the increase in the futures. More and more talk about health issues and their effect on the supply of hogs into the summer had held premium in the deferred contracts, and now those talks are causing worries of supply issues. Today’s CFTC Report showed the funds bought 766 contracts through Tuesday, bringing their long position to 82,624 contracts. The current Lean Hog index is at $80.50 and $7.78 below the current February futures. With one month to go, the futures are pricing in higher cash and cutout values before the February contract expires.

Corn: Corn futures finished the week higher but will still show a large loss for the week. Monday’s WASDE Report added bushels to the balance sheet and that has now created headwinds for the corn market to work higher. There were two flash sales of Corn exports this morning, one to Japan and one to an unknown destination. Export demand for the U.S. has been very strong up to this point of the year and is well above the pace needed to meet the USDA’s record export goal for the year. The cheaper prices that are currently seen will only help to encourage other countries to buy from the United States. Ethanol demand continues to be strong and this week’s report showed a 98,000 barrels per day increase from the previous week. Lower Corn prices and slightly higher fuel prices are helping margins at ethanol plants and encouraging those plants to run faster. The managed money sold over 65,000 contracts this week and is now back to a net short position.