Livestock Comments

by Andrew Griffith, Livestock Marketing Specialist

July 3, 2025

FED CATTLE

Fed cattle traded steady to $1 lower compared to last week. Prices in the South were mainly $222 to $224 while dressed prices were mainly $368 to $370.

The 5-area weighted average prices thru Wednesday were $229.17 live, up $1.26 compared to a week ago and $369.29 dressed, up $0.19 from last week. A year ago, prices were $191.56 live and $308.00 dressed.

Finished cattle prices held par this week compared to last week for the most part. The bear still had the upper hand on the bull, but this week’s steady to slightly lower trade does not compare with last week’s large price decline for finished cattle. The one aspect of the market that has been consistent is the positive basis. For instance, the August live cattle contract has been trading between $210 and $214 this week, which puts it about $10 behind this week’s cash market. In reality, live cattle futures do not represent the price of finished cattle in today’s market, but it does act as a proxy for directional price movement. This trend is likely to persist for the foreseeable future.

BEEF CUTOUT

At midday Thursday, the Choice cutout was $390.77 down $4.09 from Wednesday and down $5.42 from a week ago. The Select cutout was $378.99 down $1.32 from Wednesday and down $3.27 from a week ago. The Choice Select spread was $11.78 compared to $13.92 a week ago.

Boxed beef prices finally took a breather following the astronomical run they have been making the past several weeks. This slight decline in wholesale beef prices is not a sign of the market falling apart, but it probably is a sign the market is succumbing to seasonal tendencies. Beef purchases this week would be to restock the meat counter following any last-minute buying by consumers for grilling purposes for the holiday weekend. Thus, with only one more grilling holiday this summer, it will be difficult for the beef market to find support. There will certainly be people making purchases here and there for grilling purposes, but the Labor Day weekend will be the last concentrated purchasing period for beef. Since Labor Day is eight weeks down the road then it will be difficult for boxed beef prices to find much support. With the thought that boxed beef prices will decline further, the question is how much will they decline and how long will it last? The simple answer is for the market to expect softness starting now and not ending until late fall.

OUTLOOK

There are no trends this week as many of the auction markets were closed or not reported in observance of the Independence Day holiday (July 4th). Despite no available price trends, the futures market traded the first four days of the week, and in line with celebrating this great country, there were plenty of fireworks in the futures market. Using the August 2025 feeder cattle futures contract as the example, this contract closed last week at $307.90 per hundredweight. The same contract then closed the following Monday at $310.68 before plummeting $4.65 per hundredweight to Tuesday’s closing price. Wednesday was another day of higher prices as August feeder cattle traded $3.00 higher to $309.03. This is a market that is not showing a direction to either increase or decrease. The failure to establish a direction could be considered problematic, but it could also mean the market is stable. In this particular case, given the large price swings this week, the failure to establish a direction may be more of a problem than a benefit as traders do not know where to settle on feeder cattle prices. From the cattle producer standpoint, it does not matter if futures price movement is presenting a problem or not. The primary observation is that feeder cattle futures are offering an opportunity to manage price risk at a high price level for those selling. There are certainly some who will claim there is little use for price risk management, but it is a tool that can be used in tandem with other market management systems to achieve profitable price levels. As the market moves into July and August, one would surmise calf prices will begin to soften slightly as demand in the heat of summer for balling calves is not the strongest. Additionally, this weakness in calf prices is expected to persist through the fall marketing time period. This seems like a negative statement towards calf prices, but prices are not expected to decline to cellar dwelling levels. Instead, prices are expected to demonstrate some seasonal tendencies the next few months.

ASK ANDREW, TN THINK TANK

What is going right? Most of the time, questions are asked concerning what is going wrong. For instance, when a piece of equipment breaks down, the parts house operator asks what the problem is, or how did that happen? Similarly, when a person has to call the veterinary office, the veterinarian generally asks a question to determine what the struggles are with the cattle. Similarly, we tend to tell people about the challenges we have had the past few days or weeks. However, often do we think about everything that is going correctly? For instance, if a person is not having any pinkeye issues this time of year then that is a good thing. Some producers may think they are not having any issues, because they are doing all the “right things to avoid pinkeye while their neighbor is performing all the same management practices and still having challenges. For most people, there are more things going correctly each day than things going incorrectly. Thus, we should probably demonstrate our gratitude more than our displeasure.

Please send questions and comments to agriff14@utk.edu.

FRIDAY’S FUTURES MARKET CLOSING PRICES

Thursday’s closing prices were as follows: Live/fed cattle –August $214.05 +1.60; October $210.85 +1.15; December $211.23 +1.10; Feeder cattle –August $309.50 +0.48; September $309.38 +0.50; October $307.43 +1.00; November $304.50 +1.03; July corn closed at $4.32 up 2 cents from Wednesday.