Walsh Cattle Opportunities - Pure Hedge

On Friday, the USDA decided to release its plan to reopen the border with Mexico. Once again, it’s a staggered reopening starting with the port in Douglas, Arizona, on August 24. After Arizona, ports will reopen in Santa Teresa and Columbus, New Mexico. The USDA press release regarding in regard to the border reopening came out the day of an unfriendly Cattle on Feed report, with prices already in a firm downtrend. It’s clear that the cattle markets are being pressured in an attempt to lower beef prices. Remember, last October the cattle markets started to break after a comment about high beef prices from President Trump. The USDA estimated that as many as 80,000 head per month can be imported from Mexico through the reopening plan, which seems ambitious. Now that the information is out, the futures have stabilized some, but the market does not like uncertainty. I expect the cattle markets to continue to be volatile and recommend selling rallies, in the near term, despite the underlying tight supply. 

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NOVEMBER’26 FEEDER CATTLE 322.825

BUY 1 NOV’26 318.00 PUT 11.42 ½ 

SELL 1 NOV’26 308.00 PUT 7.55

SELL 1 NOV’26 346.00 CALL 5.32 ½ 

BUY 1 NOV’26 366.00 CALL 2.10

PRICE: 0.65       

COST: $325/TRADE PACKAGE, PLUS FEES AND COMMISSIONS 

NOVEMBER’26 FEEDER CATTLE OPTIONS EXPIRE 11/19/26 (113 DAYS)

MAXIMUM LOSS: LIMITED

MAXIMUM GAIN: $4,675/TRADE PACKAGE

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Hans Schmit

Broker, Pure Hedge Division

Direct: 312-765-7311

hschmit@walshtrading.com

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