Cattle Traders Look to Square Up Following Holiday, Ahead of USDA Data

Cattle futures saw gains ahead of the Cattle on Feed report, with live cattle futures closing up between $0.67 and $1.05 and feeder cattle futures up $0.82 to $0.90. Cash cattle prices have decreased, with Northern prices down $4-6 to $236 and Southern prices down $5 to $231. Analysts anticipate the June 1 cattle on feed to be 1.1% below last year, May placements down 5.9%, and marketings down 9.3%, while wholesale boxed beef prices continue to rise, with Choice boxes up $4.92 to $393.79.

Analysis

Cattle futures markets demonstrated upward momentum ahead of the anticipated Cattle on Feed report, with Live Cattle futures contracts for June, August, and October 2025 closing higher by $1.050, $1.025, and $0.675 respectively. Similarly, Feeder Cattle futures for August, September, and October 2025 saw gains ranging from $0.80 to $0.90. This futures market strength contrasts with a weakening cash cattle trade, where prices retreated by $4-6 to $236 in the North and by $5 to $231 in the South. The CME Feeder Cattle Index for June 17 also reflected this softness, declining by 42 cents to $311.04. Analyst expectations for the upcoming report point towards a tighter supply scenario: June 1 cattle on feed inventories are projected to be 1.1% lower year-over-year, with May placements anticipated to decrease by 5.9% and marketings by 9.3%. Supporting the bullish sentiment from the supply side, National Wholesale Boxed Beef prices continued their ascent, with Choice boxes increasing by $4.92 to $393.79 and Select boxes up $1.85 to $374.59, widening the Choice/Select spread to $19.20. Furthermore, USDA's federally inspected cattle slaughter figures indicate a reduction in processing, with the weekly total of 451,000 head being 5,000 head below the prior week and 28,373 head below the corresponding week last year, aligning with expectations of constrained market-ready cattle.

Key Decisions for Investors

• Investors should closely monitor the official Cattle on Feed report release to see if actual figures for on-feed numbers, placements, and marketings align with or deviate from analyst expectations of a tighter supply, as this will likely drive near-term price action.
• Given the divergence between rallying futures and declining cash prices, confirmation of reduced supply in the report could provide support to the cash market and further fuel futures, while a surprise increase in numbers could trigger a correction.
• The continued strength in wholesale boxed beef prices, despite lower slaughter rates, suggests robust underlying demand; this could be a bullish factor for cattle prices if supply constraints are confirmed and persist.
• Traders should assess positions in live and feeder cattle futures, considering the potential for volatility around the report and the implications of sustained lower placements on longer-term supply and pricing.