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Cattle futures continue to be roiled by screwworm news. Rumors of more cases in Texas in the surrounding area of the first case turned cattle lower after both markets rallied to strong resistance levels. With the weekend upcoming traders’ liquidated positions, in my opinion, established during Thursday’s spectacular run higher, especially in the Feeders. Thursday’s opening breakdown and ensuing surge saw prices trade the brand-new up limit (10.75 pts) in Feeders while cattle put in a strong rally. This led to both markets putting in Bullish Engulfing candlestick formations which has the potential to take markets higher. Cash fundamentals remain strong as cattle numbers haven’t miraculously increased in numbers. We are still faced with tight supplies and when futures were bending cash prices did not break. What we got was a normal dip in cash after cash makes all-time highs even as futures broke down to new lows for the recent down move. I haven’t seen any reports indicating beef demand is faltering and we are into the grilling season and we have important beef eating holidays’ coming up, so I believe beef demand will remain strong over the ensuing weeks. This could continue to keep the packing industry in a tight spot as they have been pulling contracted cattle forward according to my customers to slaughter. This indicates to me that they don’t have enough cattle under their control to slaughter. This is with slaughter levels declining from last year’s levels. This furthers the notion that the reason they aren’t increasing slaughter is because there aren’t enough cattle out there ready to slaughter. And now you have producers’ willing to sell cattle at lighter weights than they did before from what my conversations with producers reveal which could further tighten supply down the road. This could keep weights under pressure and keep production heading lower than expected. This could help cutout prices and force the retail industry to keep retail prices down and they finally may have to give up some of the gains they have achieved as they kept raising beef prices while cutouts have stayed in a range over the past 9ish months. We’ll see!... August Feeder Cattle opened higher, broke down to an early low and then rallied to the high of the day at 358.75. The rally stalled just under resistance at 358.875. Talk of another screwworm case in the vicinity of the prior case sent prices sinking and futures broke down, taking out the 200-DMA now at 353.85 to the low of the day at 351.20. The selling stalled just above support at the flattening 8-DMA now at 350.75 and price bounced off the low and settled just above the 200-DMA at 353.90. The price action is working with a Bullish Engulfing candlestick and a neutral candle established on Friday. We could see some consolidation as the market may pull back into the middle of the huge Engulfing candle. If price fails at the 200-DMA, we could see a pullback towards support at the 8-DMA and the 350.20. Continued weakness could see price test support at 344.675. If the 200-DMA can contain the price action we could revisit the Friday high and resistance at 358.875. Resistance then comes in at the flattening 100-DMA now at 360.90. August Live Cattle opened higher and also traded to an early low before rallying to the session high at 245.225. Pressure in the Feeder market turned cattle south and it broke down to the session low at 240.80. It lingered near the low the rest of the session and settled near it at 241.65. The rally took price past resistance at the declining 21-DMA now at 244.40 and the key level at 245.125. With the flattening 50-DMA just above at 246.10, the confluence of resistance was too much for the price action leading to the give back in price. Traders fearing more screwworm news over the weekend took what they could out of the market and called it a week. The breakdown took price below support at 242.05 and the flattening 100-DMA now at 241.35. This created a Shooting Star candlestick after Thursday’s Bullish Engulfing candle which could also pressure the price action to the middle of the engulfing candles’ range. This could likely see price test support at 238.125 if the open doesn’t see price overtake the 100-DMA. Support then comes in at the rising 200-DMA now at 236.35. If cattle can retake the key level at 242.05, it could retest resistance at the 21-DMA and then 245.125.
The Feeder Cattle Index released Friday increased and is at 361.38 as of 06/04/2026 settlement.
Boxed beef cutouts were mixed as choice cutouts ticked higher 0.04 to 392.70 and select decreased 0.35 to 382.69. The choice/ select spread widened and is at 10.01 and the load count was 91.
Friday’s estimated slaughter is 100,000, which is below last week’s 105,000 and last year’s 102,135. Saturday slaughter is expected to be 5,000, which is below last week’s 14,000 and above last year’s 1,499. The estimated slaughter for the week (so far) is 533,000, which is above last week’s 448,000 and below last year’s 581,299.
The USDA report LM_Ct131 states: So far for Friday, negotiated cash trade has been limited on moderate demand in Kansas and Nebraska. In Kansas, there have been a few live purchases at 258.00, but not enough for an adequate market test. The last established market test in Kansas was Thursday from 257.00-258.00. In Nebraska, there have been a few live purchases at 258.00, but not enough for an adequate market test. The last established market test in Nebraska was Wednesday with live purchases at mostly 256.00, and dressed purchases at mostly 405.00. Negotiated cash trade was mostly inactive on moderate demand in the Texas Panhandle and in the Western Cornbelt. The last market test in the Texas Panhandle was Wednesday with live purchases at mostly 256.00. The last market test in the Western Cornbelt was Wednesday with live purchases at mostly 256.00, and dressed purchases at 405.00.
The USDA is indicating cash trades for live cattle from 253.00 – 258.00 and from 401.00 to 410.00 on a dressed basis (so far) for the week.
**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
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