by Andrew Griffith, Livestock Marketing Specialist
October 2, 2026
FED CATTLE
Fed cattle traded steady to $1 lower on a live basis compared to last week. Prices on a live basis were mainly $219 to $221 while dressed prices were mainly $345 to $347.
The 5-area weighted average prices through Thursday were $219.90 live, down $0.85 from last week and $346.37 dressed, down $3.06 from last week. A year ago, prices were $220.75 live and $349.43 dressed.
The cattle feeder appears to have no leverage on the packer as they are unable to push cattle prices higher. There are always a limited number of market ready cattle. The packer can choose how many they are willing to purchase based on price and a cattle feeder can choose to sell as many based on a certain price. The longer cattle are on feed, the larger they get and the less efficient. As cattle grow larger, they also become less desirable to the consumer as the cuts do not fit the “box.” Cattle feeders, packers and meat purchasers have to be partners and coexist. One cannot exist without the others. When cattle prices are lower, the feedlot has to bid lower on feeder cattle. Time will tell how this all plays out.
BEEF CUTOUT
At midday Friday, the Choice cutout was $374.36 down $2.43 from Thursday and down $3.73 from a week ago. The Select cutout was $353.36 up $0.47 from Thursday and down $1.89 from last week. The Choice Select spread was $21.00 compared to $22.84 a week ago.
Margin management is the name of the game for the packer at all times, but there are seasons or points in time when they must put more focus on managing those margins. The time when margin management becomes most important is when packers are losing money. A time when this would have been the case would have been during the spring and summer when finished cattle prices were trading at record prices and boxed beef prices were unable to push higher. When this occurs, the packer must find ways to push beef prices higher, pay less for cattle or both. In the case of boxed beef prices, packers have not been successful in pushing prices higher. In the case of finished cattle prices, the price has declined for finished cattle, but there is still a negotiation process to achieve a price. Packer margins have improved since the middle of summer, but it is unlikely they are where packers want them. Thinking through boxed beef prices, it will be difficult to push boxed beef prices higher the next couple of months as demand is seasonally softer in October and November.
OUTLOOK
Based on Tennessee weekly auction market average prices, steer prices were $3 to $10 lower compared to last week, while heifer prices were $2 to $10 lower compared to the previous week. Slaughter cow prices were $3 to $5 lower this week compared to a week ago while slaughter bull prices were $2 to $4 lower compared to last week. Based on Tennessee weekly auction market prices, 550 pound steers were valued just north of $2,000 per head to finish September. This is a $600 per head decline from the peak price for this weight class of steers. Similar declines were experienced in other classes of cattle. This represents a 23 percent decline in value/price from the spring price peak. This is an abnormally large price decline from a seasonal standpoint, but it has not reached record levels yet. In 2015, the fourth quarter price low was 40 percent lower than the spring price peak while the decline in 2016 from the spring high to the fall low was 38 percent. A more “typical” year would be 2024 when prices declined 14 percent from the spring marketing period to the fall marketing period. This is the long way of saying the market has not reached record territory yet as far as a price decline, but the price of freshly weaned cattle typically hit their low in October or November, which means there is still time to eclipse the price decline of 2015 and 2016 on a percentage basis. However, to reach a 40 percent decline, the price of 550 pound steers in Tennessee would have to dip to $289 per hundredweight over the next couple of months. This is highly unlikely in a short time frame, but nothing can be ruled out in this volatile market. Shifting gears, the slaughter cow market is a market to keep an eye on. There may be opportunities to add weight to slaughter cows this winter if the price of slaughter cows continues to trend lower. If there is anything in the cattle and beef markets that would seem certain is consumers continuing to eat ground beef. This would suggest slaughter cow prices will rebound nicely from February through June of 2027.
ASK ANDREW, TN THINK TANK
When is it going to rain? It rains somewhere every day. In fact, it is probably always raining somewhere just like it is “five o’clock somewhere.” Everyone knows the question is when is it going to rain in their location. Anyone who could predict weather accurately a few days in advance would have job security. Anyone who could predict weather a month in advance would not have money problems. Anyone who could predict weather accurately for a full growing season or three years clearly has a direct line of communication with God and is probably named Elijah. Agricultural producers tend to expend a significant quantity of effort consuming weather predictions, which is reasonable since the business is highly dependent on weather conditions. Do agricultural producers spend too much time and effort consuming weather information given the inability to influence weather and the inaccuracies of longer-term predictions? The answer depends on if there is a higher value.
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 –October $218.85 -0.45; December $221.48 -1.70; February $223.15 -2.30; Feeder cattle –October $334.63 -4.25; November $331.15 -5.20; January $324.55 -5.15; March $320.83 -4.85; December corn closed at $4.98 down 5 cents from Thursday.