Cattle Markets Surge - Cash Markets Steady

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The Cattle futures markets had a rocky start to the week, breaking down on Monday to test the prior week’s lows. Excitement started to build on Tuesday with a strong rally but Wednesday and Thursday saw consolidation as cash trade was non-existent. Friday’s price action started off neutral but after making the lows for the day crept higher and then took off after the WASDE report sent corn prices reeling and never looked back. The rally in the cattle markets took price to new highs for the recent up move in the cattle markets as traders seem to be getting more interested in being long the market. Maybe the expectation is as we get closer to the election the government will stay out of the way and allow the market to function on its own fundamentals. This is highlighted by the President saying he will not look to renew the tariff relief after the three-month time period for tariff relief is done with. This likely is creating sentiment that after the election the government will stay out of the way and let the fundamentals control the market because the relief they were looking for hasn’t materialized. The lower prices occurred in the cattle price. The cutout has stayed in the same range it has been in since making all-time high choice cutout (except for pandemic) in September 2025. The retail industry has constantly raised price to new highs relentlessly and has finally started to slow the increase as consumers are more price conscious with gas prices so high. This continued rally in cattle could finally help support cash prices as we move towards November and likely create more bullish sentiment if this rally can survive pullbacks. The packer is still in control of cash in my opinion as cash remained within last week’s price range even as futures prices moved above cash. Even October is above where cash traded this week so we may see some deliveries by frustrated producers who feel they aren’t getting treated fairly. In my opinion, the fundamentals are still bullish for cattle prices and if the government stays out of the way, the fundamentals should eventually win the day.   We’ll see!... November Feeder Cattle made its low during the 1^st 5-minutes of the day at 334.60 and rallied the rest of the session to the high at 342.40. It settled near the high at 341.95. The open tested trendline support at 334.225 and the rally took price above resistance at 341.05 but stalling just below the declining 100-DMA now at 343.05. If price can hold settlement, it could test resistance at the 100-DMA. Resistance then comes in at 344.675. A failure from 341.05 could see price test support at 337.575.  Support then comes in at 335.975. December Live Cattle opened lower and made the low at 223.30. This was a test of support at 223.275 and price rallied from here the rest of the session to the high at 227.55. It settled near the high at 227.05. The rally took price past resistance at 226.60. If settlement holds, price could test resistance at the declining 100-DMA now at 228.50. Resistance then comes in at 230.425. A failure from 226.60 could see price test support at 224.55. Support then comes in at 223.275.

The Feeder Cattle Index increased and is at 33707 as of 10/08/2026 settlement. 

Boxed beef cutouts were mixed as choice cutouts decreased 1.50 to 373.35 and select jumped 2.57 to 354.30. The choice/ select spread narrowed and is at 19.05 and the load count was 124.

Friday’s estimated slaughter is 94,000, which is below last week’s 100,000 and above last year’s 93,748. Saturday slaughter is expected to be 5,000, which is below last week’s 38,000 and last year’s 7,920. The estimated total for the week (so far) is 531,000, which is below last week’s 548,000 and last year’s 551,329.

The USDA report LM_Ct131 states: So far for Friday, negotiated cash trade in Nebraska and the Western Cornbelt has been light on moderate demand. In Nebraska, live purchases have been mostly 222.00, steady to 2.00 higher compared to last week. Dressed purchases have been at 345.00, steady compared to Thursday. In the Western Cornbelt, live purchases have ranged from 218.00-220.00, steady compared to Thursday. The last established market test for dressed purchases was Thursday at mostly 345.00.

The USDA is indicating cash trades for live cattle from 218.00 – 222.00 and from 345.00 – 352.00 on a dressed basis (so far) for the week.

Trade Strategy:

February 2027 Live Cattle Options Strategy 

Sell the February 2027 Live Cattle 250/230 put spread at 17 cents.

• Premium collected: $6,800, less commissions and fees
• Maximum risk: $1,200, plus commissions and fees
• Margin requirement: $1,104
• Risk management: Consider limiting risk to 200 points ($800) plus commissions and fees
• Profit objective: Work a bid to buy back the spread at 7 cents
• Potential gain: Approximately $4,000, less commissions and fees
• Premium collected: $1,250.00, less commissions and fees(250 points) per spread
• Maximum risk: $3,750, plus commissions and fees per spread

Feeder Cattle Opportunity:

Sell the January 2027 Feeder Cattle 330/320 put spread for 700 points a $3,500.00 credit. Buy

the March Feeder Cattle 340 Call for 450 points a $2,250.00 debit. 

**Call me for a free consultation for a marketing plan regarding your livestock needs.**

Ben DiCostanzo

Senior Livestock Analyst

Walsh Trading, Inc.

Direct: 312.957.4163

888.391.7894

Fax: 312.256.0109

bdicostanzo@walshtrading.com

www.walshtrading.com

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