by Andrew Griffith, Livestock Marketing Specialist
May 8, 2026
FED CATTLE
Fed cattle traded $3 higher on a live basis compared to last week. Prices on a live basis were mainly $257 to $260 while prices on a dressed basis were largely $402 to $403.
The 5-area weighted average prices thru Thursday were $258.32 live, up $3.30 compared to a week ago and $402.37 dressed, up $3.30 from last week. A year ago, prices were $224.49 live and $356.07 dressed.
Cattle feeders were able to get more money out of packers again this week despite the math not adding. The math to consider is a dressed cattle price exceeding $400 and a Choice boxed beef price less than $390. This means packers are not adding to the bottom line but continue to take away from the bottom line. On the cattle feeding side, the math is a tight margin, but there is a possibility of a profit. Cattle feeders are buying feeder cattle (900 lb) back for $700 to $750 less than they are receiving for finished cattle (1,500 lb). That does not leave much room for profit when needing 600 pounds of gain. This is no game for the faint of heart, but it could result in heart problems down the road!
BEEF CUTOUT
At midday Friday, the Choice cutout was $389.02 up $2.08 from Thursday and down $0.26 from a week ago. The Select cutout was $385.17 up $0.75 from Thursday and up $0.21 from last week. The Choice Select spread was $3.85 compared to negative $2.76 a week ago.
When will buyer interest in steak cuts be evident? There is no indication from a price standpoint that buyers are bidding up Prime, Branded, or Choice grade steak cuts. One could say there was more interest in March than there is in May, which was an idea posed a couple months ago. The idea in March was that meat buyers were purchasing beef in advance with the idea of wholesale beef prices increasing leading into the summer grilling season. However, high quality beef prices are not increasing at any rate to signify a rush on the market. More specifically, there tends to be a push for steak cuts as Memorial Day weekend approaches, but the rib and loin primal values are not indicating restaurants, grocers, or food service chasing product to stock the meat counter. This may mean nothing at all since beef prices remain elevated, but it could be a cause for concern as consumers are probably spending a higher percentage of their discretionary dollar on fuel instead of food. Cattle and beef markets are not immune to outside influences, and this may be what the market is experiencing.
OUTLOOK
Based on Tennessee weekly auction market average prices, steer prices were steady to $4 higher than last week, while heifer prices were steady to $7 higher compared to the previous week. Slaughter cow prices were steady to $2 lower this week compared to a week ago while slaughter bull prices were steady to $1 higher compared to last week. Volatility is the name of the game when it comes to cattle markets, and it seems to be dominating all opponents. Local auction market trends compared to last week were mixed depending on the day of the sale for the most part. This falls in line with feeder cattle futures price movement, which was more like an unpredictable seesaw. It is clear volatility in the market place is present, and that it has many purveyors on edge. However, volatility in the market is not always a bad thing. It is only bad if someone is selling on the cash market when the market goes down and the seller has no price protection, because the alternative is volatility sending the market higher and a cattle seller benefiting from higher prices. The opposite argument would be true for a cattle buyer. Beyond the elementary illustration, volatility has always been present and will likely always be a piece of the cattle marketing puzzle unless some type of structural change takes place in the industry. Thus, cattle producers should learn how to manage and use price volatility to their advantage. For instance, the futures market offers a price for a future sell date that may or may not be realized at that future date. Producers can take advantage of a price in the future using futures, options, or LRP. However, the ability to manage volatility diminishes as one nears the anticipated marketing period. Despite volatility in cattle markets, the price of cattle is expected to remain elevated for the next two to three years due to supply and demand factors present in the market. This however does not insulate a producer from a sudden price decline or increase in prices for that matter, which is why risk management can be advantageous.
ASK ANDREW, TN THINK TANK
If all cattle prices were to decline ??? percent, would a producer be better off owning cows or stocker cattle? The CME feeder cattle index peaked December 2014 near $245 per hundredweight and bottomed near $120 per hundredweight in October 2016. This is a 51 percent decline in less than two years for an 800 pound steer. The CME index has been as high as $377 per hundredweight and was at $375 as recently as this week. It is unlikely cattle prices will decline 50 percent in a short period, but the market will decline at some point in the future if history is an indicator. A 550 pound steer in Tennessee is valued near $2,600 per head with 900 pound steers in load lots near $3,150 per head, which leaves $550 of margin to put on 350 pounds on gain. If prices were to decline 10 percent during the feeding period then there would only be $300 of margin, likely resulting in a loss. On the cow side, the value lost is in the cow or what was paid for replacement females. Thus, the dollar loss may not be realized, but the equity value is lost in the cow and the value of the next calf is reduced.
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 –June $248.90 -1.15; August $244.10 -1.80; October $238.30 -1.68; Feeder cattle –May $367.38 +1.05; August $364.23 -1.95; September $362.23 -2.43; October $362.23 -2.53; May corn closed at $4.56 up 4 cents from Thursday.