Feeder Cattle and Live Cattle Under Selling Pressure as Week Winds Down

The livestock futures complex retreated sharply on Friday, with both live cattle and feeder cattle contracts posting significant losses heading into the weekend. Live cattle futures finished lower by 57 cents to $1.40, though February contracts managed to close $2.40 higher for the week. The weakness in feeder cattle was more pronounced, with most contracts surrendering $3.35 to $4.30 on the day, while January posted a modest five-cent weekly gain.

Feeder Cattle Market Softens Amid Mixed Signals

The CME Feeder Cattle Index staged a partial recovery, climbing $1.30 to settle at $346.77 on December 10, yet this gain was insufficient to offset broader contract declines. Speculative positioning data from the Commitment of Traders report reveals continued fund liquidation, with specs reducing net long exposure by 3,934 contracts to 97,331—a level reflecting cautious sentiment among technical traders. Managed money maintained a net long posture in feeder cattle futures and options, holding 17,430 contracts as of mid-November.

December feeder cattle wrapped at $339.10, down $4.30, while March and April contracts closed at $334.075 (down $3.60) and $333.225 (down $3.35) respectively, signaling a bearish tone across the forward curve.

Live Cattle Steady Despite Weekly Setbacks

Cash trade demonstrated relative strength this week, with most regions trading around the $230 level, providing a floor beneath the futures selloff. December live cattle finished at $229.80, down $0.575, while February settled at $229.55, down $1.40. April cattle declined $1.275 to $229.40, with the week-to-date strength in February suggesting some demand absorption at lower levels.

Boxed Beef Prices Show Divergence

USDA wholesale boxed beef prices reflected mixed directionality in the Friday afternoon report. Choice cuts retreated 67 cents to $357.44, while Select beef advanced 76 cents to $344.22, narrowing the Choice/Select spread to $13.22. This divergence suggests shifting buyer preference toward lower-priced cuts amid seasonal demand variations.

Supply Remains Constrained

USDA federally inspected cattle slaughter was estimated at 589,000 head for the week through Saturday—a decline of 4,000 head from the prior week and 15,032 head below the year-ago comparable. The tighter supply dynamic underpins underlying support for the cash market despite futures weakness.