by Andrew Griffith, Livestock Marketing Specialist
December 12, 2025
FED CATTLE
Fed cattle traded $6 to $8 higher this week compared to a week ago on a live basis. Prices on a live basis were mainly $228 to $230 while dressed prices were mainly $353 to $355.
The 5-area weighted average prices thru Thursday were $228.12 live, up $8.10 compared to a week ago and $353.61 dressed up $11.22 compared to last week. A year ago, prices were $194.31 live and $303.40 dressed.
Cattle feeders were willing sellers this week with much stronger prices compared to the previous week. Being willing to sell earlier in the week was probably a good thing since live cattle futures faltered on Friday. Live cattle basis is about as narrow as the market has witnessed in many months. It is difficult to establish what the narrowing of basis means in the current market, but it does mean cattle feeders are assuming a larger financial risk if they are counting on a positive basis to bail them out of a poor buy sell margin from feeder to fed animal. Looking into the next several weeks, it may be difficult for finished cattle prices to push higher as the market approaches a seasonal demand dip following the holidays.
BEEF CUTOUT
At midday Friday, the Choice cutout was $357.26 down $0.85 from Thursday and down $5.42 from a week ago. The Select cutout was $344.78 up $1.32 from Thursday and down $4.70 from a week ago. The Choice Select spread was $12.48 compared to $13.20 a week ago.
The comprehensive boxed beef cutout peaked at $409.20 per hundredweight the first week of September. The price has declined more than $40 the past three months. Thus, the wholesale value of beef has declined considerably, but that will do little to change retail prices in the near term. This brings to question what primal is underperforming or what is supporting the total value of a beef carcass. During the winter holidays, the rib primal generally carries the cutout. Over the three month period being discussed, the rib value has only increased about $13 per hundredweight from $630.76 to $643.29. The remaining six primal values have declined over that time period including chuck (-$69.97), round (-$69.01), loin (-$17.85), brisket (-$20.18), plate (-$20.56), and flank (-$55.04). The carcass is heavily weighted toward the chuck and round as they comprise a little more than 50 percent of the carcass. The loin comprises approximately 20 percent of the carcass while the rib is approximately 10 percent of the carcass. This means the entire carcass is being challenged.
OUTLOOK
Based on Tennessee weekly auction market averages, steer prices were $8 to $13 higher this week compared to last week while heifer prices were $7 to $12 higher than the previous week. Slaughter cow prices were unevenly steady compared to a week ago while slaughter bull prices were $1 to $2 lower than last week. Feeder cattle and calf prices made a 180 degree turn in the last half of October. They appear to be in the midst of another 180 degree turn heading toward the winter cattle marketing break. Reading price trends is one thing, but discussing the actual magnitude of price changes is another. January feeder cattle futures life of contract high was near $380 per hundredweight on October 16th. The contract was in freefall through November 25th and actually experienced prices below $300 per hundredweight. The $80 per hundredweight decline represents a change of $640 per head and $40,000 per feeder cattle contract. Fortunately or unfortunately, the cash feeder cattle price only declined $57 per hundredweight over the same time period. Since November 25th, the January feeder cattle futures contract has recaptured about half of the losses and was trading in the low $340s this week. Similarly, the CME feeder cattle index value was in the mid $340s the second week of December. The calf market in Tennessee did not have the same magnitude of price swings as the yearling cattle market. Calf prices for 500-600 pound steers in Tennessee peaked at $395 per hundredweight the last week of August and traded as low as $369 the last week of October, but this timeline does not fully coincide with the same factors that depressed feeder cattle cash and futures prices, which means a portion of this decline had a seasonal component. Since the end of October, the 500-600 pound average steer price in Tennessee has increased and sits around $380 per hundredweight. There is approximately $700 to $750 of margin to put 300 pounds on a 550 pound steer. If cost of gain is $1 per pound then there is $400 to $450 to serve as a risk premium and profit.
ASK ANDREW, TN THINK TANK
What is the biggest challenge for the beef industry? This is a “Whopper” of a question. The rapper “Tee Bone” is likely to have a different answer than the English knight “Sir Loin.” Please pardon the weak humor, but there are production challenges such as New World Screwworm that also influence cattle trade coming north across the Mexican border to record high beef prices influencing the domestic market and international market. However, the international market has also been influenced by trade tensions. Thus, what is the biggest challenge? There is no reason to isolate one challenge. Beef producers are constantly challenged with production issues ranging from drought, flooding, parasites, genetic abnormalities, diseases and much more. At the same time, beef producers are managing their cattle herds amidst changing market dynamics for hundreds of different beef items in the domestic and international markets. Thus, the biggest challenge is all of them. This is a dynamic and challenging business and market from top (loin) to bottom (loin).
Please send questions and comments to agriff14@utk.edu.
FRIDAY’S FUTURES MARKET CLOSING PRICES
Friday’s closing prices were as follows: Live/fed cattle –December $229.80 -0.58; February $229.55 -1.40; April $229.40 -1.28; Feeder cattle –January $339.10 -4.30; March $334.08 -3.60; April $333.23 -3.35; May $331.28 -3.25; December corn closed at $4.32 down 4 cents from Thursday.