7/28/2026 Market Commentary

Live Cattle: Live Cattle futures traded higher for the entire day after yesterday’s pressure from the Feeder Cattle complex pushed the market to the lowest levels since mid-December. Today, the further out deferred contracts along with the nearby August contract saw the least amount of gains as the deferreds price in larger supplies due to the opening of the Mexican border and the August stays in line with the current cash market. There was very limited trade yesterday at 228 live and 360 dressed in the North. With today’s increase in the futures, basis levels have collapsed to near zero after seeing a positive $8 basis last week. This weekend’s heat will have an impact on the market going forward and should reduce production and tonnage over the next few weeks. Death reports range greatly from region to region and feed yard to feed yard, but the heat definitely took weight off of cattle that are going to slaughter. It will be hard to peg actual losses to death loss and decreased weights, but both variables will contribute to lower beef production. Boxed beef has found slight support in this area after trading lower for the better part of three weeks. This afternoon, choice was quoted $2.97 higher at $365.86 while select was $1.64 lower at $343.52. Many analysts were looking for the $361 area to hold choice boxes and so far that line has held. The choice/select spread has widened to $22.34. Most times, this would be attributed to good beef demand, and while demand may be fine, the supply of select beef is continuing to increase through increased imports.

Feeder Cattle: Feeder Cattle futures finished limit lower on Monday in the deferred contracts following the announcement on Friday evening that the USDA would be opening one of the Southern ports for imports of Mexican Feeder Cattle. Today, the nearby contracts finished sharply higher while the deferred contracts again struggled to find support. The bull spreads in the market today make sense as the Mexican Border will not be opened until August 24, and then a phased reopening will take place for additional ports. According to the USDA press release, the port in Douglas, Arizona will open on August 24 while simultaneously initiating the operational steps necessary for subsequent openings at the Santa Teresa and Columbus, New Mexico ports. All animals that pass through these ports will undergo a full inspection to ensure no signs of New World Screwworm. The Douglas, Arizona port accounted for about 15% of the total Feeder Cattle imports before the border was closed. With the increased inspection protocols that are taking place the port will be no where near full capacity when it reopens but speculation is for a range of 150,000 to 300,000 head to cross the border through all ports between August 24 and the end of 2026. It is important to remember that the country of Mexico has updated their infrastructure and cattle feeding abilities in the past 20 months since the border has been closed. In 2024, the U.S. imported about 1.2 million head of cattle from Mexico in just under 11 months. Standard flows of cattle are not expected going forward but monthly totals will be something to keep an eye on to see what the new pace of Feeder Cattle imports looks like going forward.

Lean Hogs: Lean Hog futures finished the day higher, erasing most of the losses from Monday. The Cold Storage Report that was released on Friday afternoon showed total pork supplies up 9.4% compared to a year ago and just 0.7% larger than last month. There were large increases in both the hams and bellies from both last year and last month. This is due to larger than expected production over the last few months that has filled coolers and weaker demand. The pork cutout has been range bound for the last week and was quoted $0.18 lower yesterday at $104.45. Last week’s slaughter was estimated at 2,680,000 head, down 28,000 head from the previous week and over 55,000 head less than a year ago. The smaller slaughter totals have helped support the pork cutout but large stocks will keep the cutout suppressed going forward.

Corn: Corn futures opened the week lower and continued the lower tone all day on Monday but found support today and recovered half of those losses. Forecasts for the next seven days show increased moisture for many of the Corn producing states along with decreased temperatures. The improved forecasts along with losses seen in the crude oil market all led to the softer market on Monday. Today, the futures found support on what look to be technical buying. The USDA released their weekly Crop Progress Report yesterday afternoon and showed the national Corn crop declining 4% compared to a week ago with big decreases seen in many states. North Dakota ratings lost 11%, South Dakota dropped 6%, Kansas down 10% and Nebraska lost 5%. The national Corn rating is now below the 5-year average by 1%. The western Corn Belt is showing the most stress according to the ratings with the lack of moisture over the past 30 days and the recent heat that has set in over the region. Friday’s highs will offer the first line of technical resistance to the market if outside influences continue to drive prices higher.