6/24/2025 Market Commentary

Live Cattle: The cattle complex has run out of bullish news to feed the bulls for the time being. The cash market traded lower for the first time in two and a half months last week, world tensions, ice raids, and continued worries about the state of the U.S. consumer have all moved the futures market lower. At some point the market needed to step back and say “how much better can the news get”, and I think that is a lot of what the market is seeing. Markets do not like uncertainty, and no market is more prone to that phrase that the cattle complex. While cash fundamentals remain well above the futures, optimism for those prices to remain for an extended period of time has deteriorated. One of the few bright spots has been the boxed beef market. Choice was quoted lower on Friday and Monday but was back higher this morning to $391.35. The choice/select spread has narrowed to 10.37 with the latest run in prices. A narrow choice/select spread does not indicate great demand, but this spread has been more narrow than normal for quite some time. Average carcass weights have also moved lower with the good cash price and excellent basis that has pulled cattle ahead. Cash this week will dictate the next move in the futures market. The feeling throughout feedlot country is a hope for steady but would not be surprised by a lower market again this week.

Feeder Cattle: Feeder Cattle futures started the day sharply higher before trading lower late in the morning and throughout the duration of the day. The CME Feeder Cattle index has grown stagnant after a $20 move higher over the course of two weeks. The Live Cattle futures that have quietly dropped $10 and a cash market that failed to trade higher both have a part in the lower bids for Feeder Cattle across the country. As of last Tuesday, the managed money were long 35,858 contracts, down 104 contracts from the all-time record set the week prior. Cheap feed, good grass conditions for most of the U.S., and optimism for future prices have pushed Feeder Cattle to these levels and continue to keep prices elevated. While the cash and futures have both backed off of their highs, overall prices remain strong.

Lean Hogs: Lean Hog futures traded lower all day today as the cash and cutout markets have begun trading sideways to even a touch lower. The lower cash fundamentals are nothing to be overly concerned about, but it is definitely a change of pace from what the market has seen over the past six weeks. Yesterday’s Commitment of Traders report showed the funds as big buyers of the hog complex for the week ending June 17. The managed money is now long 129,850 contracts which is an increase of 11,632 contracts on the week. The all-time record long position is 133,507 contracts and the funds very well could be over that number as of today. Conversely, the producer sector of the industry has built a near record short position as they protect prices at these levels and capture profits that have been hard to come by in the past few years. Hog weights continue to work lower which is seasonal for the summer and warmer weather. Hog slaughter also continues to lag from a year ago and has been revised lower compared to initial estimates in recent weeks.

Corn: Corn futures continued the lower trend today as bullish news continues to be absent from the market. The September contract posted another contract low today and December came within a few cents of setting a new contract low. The USDA released their weekly crop progress report yesterday and showed the U.S. corn condition dropping 2% to 70% good to excellent. The futures market did not react in a positive manner overnight and throughout the day session as the weather forecast ahead looks favorable for production. Crude Oil traded to nearly a $12 range yesterday after a higher open due to war tensions overseas that the U.S. are involved in. Futures faded lower all day and finished over $5 lower. Today Crude Oil futures are down another $3+ which is not helping support the corn market. The Commitment of Traders report was released yesterday due to the holiday last Thursday. In corn, the managed money were sellers of 20,768 contracts on the week and have pushed their short position to 184,788 contracts. The managed money never found interest in the corn market this spring or early summer and continued to be sellers, hampering any hopes of a rally within the corn complex. Next Monday is the Quarterly Stocks report along with planted acres and crop production. This is a report that has the potential of moving the market in a big way, but there will need to be a few bullish surprises within the report to spur a move higher in corn.