Cattle Markets Rally in Front of Cattle on Feed

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The cattle markets broke down early in the session as traders assumed the packer would be able to get lower cash prices on Friday. Expectations were with lower slaughter thought to occur for this week, the packer needs would be lessened, and the producer would cave to the packer demand for lower prices.  This with the Cattle on Feed report due after the close would push nervous producers over the edge. This, however, didn’t happen as a stronger morning cutout, firmed producers’ demands and the packer was the one who caved. With rumors of cash trading at 235.00 and 236.00, futures rebounded off the lows and surged with fats leading the way higher. With some producers facing losses if prices stayed at last week’s prices, and an expected bullish Cattle on Feed report due after the close, they were willing to hold on and wait for next week if prices didn’t improve to mitigate any loss on their cattle. The rally in fats  sent prices higher for the week though they weren’t able to take out last Friday’s high during the rally, keeping the Bearish Engulfing candle as the dominant pattern in the market. Feeders were able to test Friday’s low and nearby support and rally but, its rally was only able to topple this week’s early high and didn’t come close to challenging last Friday’s high also leaving its Bearish Engulfing candle intact. April Live Cattle opened higher and crashed to the low of the day at 232.65. This was a new low for the week but was above last Friday’s low. It also was a successful test of support at 232.75 with it stabilizing the price action. The rally saw price take out resistance at 235.625 and the short and mid-term moving averages to a test of resistance at 238.125 with the high just above it at 238.15. It pulled back into the close and settled at 236.925. March Feeders opened higher and broke down hard, taking out this weeks and Fridays low to the low at 354.55 test support at that same level. It rebounded and traded higher, taking out resistance at 358.625, its short-term moving averages and this week’s high to the new high for the week at 361.65. It also pulled back into the close and settled at 360.175. The Cattle on Feed report is below and for the most part was withing expectations though the placements were a little higher than expected, which might see a lower opening if traders view the higher placement as bearish. In my view, we continue to see lower numbers going into feedyards than last year, so this shows tighter cattle supplies continuing. Next week there could also be a weather market if the meteorologists are correct with the severe weather, especially in the south. We’ll see! If April Live Cattle can take out the Friday high and the last Friday’s high at 238.60, we could see price move towards a test of resistance at 242.075. A breakdown from settlement could see price re-test support at 235.625. Support then comes in at 232.75 and then the 100-DMA now at 231.225. If Feeder cattle can hold settlement, it could see price re-test resistance at 363.00. Last Friday’s high is at 365.00 and resistance then comes in at 365.675. A breakdown from settlement could see price re-test support at 354.55. Support then comes in at 350.20. 

The Feeder Cattle Index decreased and is at 363.48 as of 01/22/2026.

Boxed beef cutouts were higher as choice cutouts increased 1.47 to 368.92 and select increased 0.66 to 362.39. The choice/ select spread widened and is at 6.53 and the load count was 123.

Friday’s estimated slaughter is 84,000, which is below last week’s 92,000 and last year’s 109,949. Saturday slaughter s expected to be 4,000, which is above last week’s 1,000 and last year’s 2,921. The estimated slaughter for the week (so far) is 535,000, which is below last week’s 562,000 and last year’s 593,858.

The USDA report LM_Ct131 states So far for Friday, negotiated cash trade has been moderate to active on good demand in Nebraska. Compared to last week, live purchases have been 1.00-3.00 higher from 234.00-236.00 and dressed purchases have been 5.00 higher ranging from 368.00-370.00, mostly 370.00. Negotiated cash trade has been moderate on good demand in all other feeding regions. Compared to last week in the Western Cornbelt, live purchases have been 3.00 higher from 232.00-235.00, mostly 235.00, and dressed purchases have been 2.00-3.00 higher from 365.00-368.00. Compared to last week in Kansas, live purchases have been unevenly steady from 233.00-235.00, mostly 233.00. Live purchases in the Texas Panhandle have ranged from 234.00-236.00 with no recently established market to compare to. 

The USDA is indicating cash trades for live cattle from 232.00 – 236.50 and from 363.00 – 370.00 on a dressed basis (so far) for the week.

United States Cattle on Feed Down 3 Percent Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.5 million head on January 1, 2026. The inventory was 3 percent below January 1, 2025. The inventory included 7.02 million steers and steer calves, down 3 percent from the previous year. This group accounted for 61 percent of the total inventory. Heifers and heifer calves accounted for 4.44 million head, down 3 percent from 2025. 

Placements in feedlots during December totaled 1.55 million head, 5 percent below 2024. Net placements were 1.50 million head. During December, placements of cattle and calves weighing less than 600 pounds were 365,000 head, 600-699 pounds were 360,000 head, 700-799 pounds were 355,000 head, 800-899 pounds were 274,000 head, 900-999 pounds were 115,000 head, and 1,000 pounds and greater were 85,000 head. 

Marketings of fed cattle during December totaled 1.77 million head, 2 percent above 2024. Other disappearance totaled 58,000 head during December, 2 percent below 2024.

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