CATTLE feeders and packers were in a stalemate for much of last week, as feeders continued to add weight to cattle and packers sought lower prices because of increasingly negative operating margins. Fed steer prices, basis USDA’s 5-area region, advanced $16.66 per cwt the first two weeks of December, so another big advance was unlikely last week. Live prices the week before last averaged $228.19 per cwt, up $8.48 per cwt on the prior week, while dressed prices averaged $353.62 per cwt, up $11.01 per cwt. Last week saw little trade through Wednesday but an active trade up north Thursday at $228 per cwt live or $355-363 per cwt dressed.
The economics of adding additional pounds continues to pay the producer a return that is too much to ignore, says Andrew Gottschalk, HedgersEdge.com. Producers will not disappoint as long as the cost of adding additional pounds exceeds the selling price of fed cattle and cattle are trading above their breakeven levels. The latter will begin to change as breakevens are projected to advance significantly from current levels into the late spring. Breakevens in much of the later portion of that period will begin to exceed current cattle prices, he says.
USDA’s report each Thursday that includes carcass weight averages will be delayed this week because of Christmas Day on Thursday. The latest available report was for the week ended December 6 and showed that steer and overall weights rebounded to new record highs. Steer weights averaged 988 lbs, up 5 lbs from the week before and up 36 lbs on the same week last year. Heifer weights averaged 894 lbs, up 1 lb from the week before and up 29 lbs on the same week last year. Overall weights averaged 900 lbs, up 4 lbs from the week before and up 31 lbs on the same week last year.
The total harvest for this week stands at an indeterminate level for now, says Gottschalk. His guess is a level somewhere between 440,000 and 465,000 head. Marketable fed cattle supplies in the Corn Belt remain front-end loaded, with quantities of larger-sized cattle remaining in abundance. Southern Plains supplies may also be approaching a threshold of a modest increase in marketable supplies. Feeding margins and better than manageable costs of gain have producers adding on the pounds as the first day of winter approaches, he says.
Boxed beef cutout values declined sharply the week before last week. The comprehensive cutout averaged $361.52 per cwt, down $4.88 per cwt from the week before. The Choice cutout averaged $357.60, down $6.59 per cwt, while the Select cutout averaged $346.08 per cwt, down $5.11 per cwt. Formula-priced sales accounted for 54.1% of the total volume of 6738 loads. Spot market sales accounted for 30.9%, forward sales accounted for 14.9% and export sales accounted for 9.4%. The Choice cutout the first four days of last week declined by $0.16 per cwt to $357.28 per cwt while the Select cutout declined by $0.25 per cwt to $343.97 per cwt. Meanwhile, the six-month old Sustainable Beef plant in North Platte, Neb., is currently processing up to 1300 head per day. So it is on its way to its stated goal of 1500 head per day. Sustainable Beef’s board of directors is considering boosting the operation to1800 head daily as part of a single daytime shift, say reports.
BEST WISHES FOR 2026: Cattle Buyers Weekly will not be published on December 26 due to the Christmas holiday. CBW wishes you a prosperous and fulfilling 2026 and trusts you will enjoy the holiday season wherever you are. CBW has begun its 39th year of covering the North American and global meat and livestock industry, with a special focus on the U.S. beef industry. CBW thanks its readers for their unwavering support over the past 38 years.
USDA RAISES ITS BEEF FORECASTS
USDA raises its forecasts for U.S. beef production in the fourth quarter and for 2026. It puts the fourth quarter production at 6.595 billion lbs, slightly ahead of the first quarter total to be the highest quarterly total of 2025. The increase is based on daily and weekly estimated slaughter data for November through early December, says USDA’s Economic Research Service (ERS) in its December Livestock, Dairy and Poultry Outlook report. Cattle have been slaughtered at a slightly faster pace than previously expected. Moreover, weekly average carcass weights have set new all-time records, raising expectations for the remainder of the quarter, it says.
As a result, ERS’s beef production forecast for the fourth quarter is raised 185M lbs from last month, says ERS. The annual total is raised 194M lbs to 25.950 billion pounds but this is a decline of 3.8% from last year’s 26.984 billion lbs. Based on updated cattle on feed data for October and November, expectations are raised for marketings for slaughter in the first half of 2026 but are lowered for marketings in the second half of the year, says ERS. This is a net decline in anticipated marketings. However, the trend of record weights in late 2025 will be carried over into 2026, more than offsetting the decline in marketings. As a result, its forecast for 2026 beef production is raised 335M lbs from last month to 25.725 billion lbs, a decline of 1% from 2025.
Cattle prices since mid-November have fluctuated due to several announcements regarding U.S. beef imports from Brazil and beef packing capacity in the U.S., says ERS. On November 15, U.S. tariffs of 10% were removed on beef and various goods from Brazil. The following week, the remaining 40% tariff on beef and other goods from Brazil was removed. That same week, Tyson Foods announced it would be reducing beef packing operations at two of its facilities.
With that news, slaughter steer prices in the 5-area marketing region closed lower week-on-week in November for a monthly weighted average price of $221.02 per cwt live, says ERS. This was $14.54 per cwt lower than October and the lowest average price since April. However, prices made an upward correction from $211.53 per cwt during the last week of November to $221.21 per cwt in the first week of December. Based on price data through early December, the slaughter steer price forecast for fourth quarter 2025 is lowered $8 per cwt from last month to $226.00 per cwt. (Editor’s note: The big price rally the second week of December means the fourth quarter average will likely be higher that this).
Lower Placements Will Support Record Prices
Looking ahead to 2026, lower year-over-year placements of calves in feedlots are still expected for the fourth quarter of 2025 and in the first half of 2026, says ERS. This is expected to support record prices next year, albeit lower than previously projected. Consequently, its 2026 price forecast is lowered $11 per cwt to $235 per cwt, which is still a 5% year-over-year increase. The impact of the November announcements also carried over to feeder steer prices. In November, the weighted-average price for feeder steers weighing 750-800 lbs at the Oklahoma City National Stockyards was $346.18 per cwt, a decline of nearly $30 per cwt from October.
The decline was notable as feeder steer prices set an all-time record of $383.48 per cwt in the second week of October, says ERS. On a very low number of calves sold on November 24, feeder steer prices dropped to $317.71 per cwt. Two weeks later, on December 8, prices rebounded to $343.96 per cwt. Based on the latest price data, its fourth quarter price forecast for feeder steers is $4 per cwt less than last month at $354.00 per cwt. Next year, the feeder steer price forecast is lowered $17.25 per cwt from last month to $345.00 per cwt. Tighter supplies of feeder cattle will continue to keep prices elevated, says ERS.
U.S. beef processors will be under even more supply pressure this year if cow-calf producers start retaining more heifers to rebuild their herds, says ERS. It also forecasts that pork production in 2026 will total 27.475 billion lbs, up from 27.462 billion lbs in 2025. It forecasts that broiler production will total 48.550 billion lbs, up from 48.086 billion in 2025. ERS forecasts that per capita disappearance in retail pounds will be: 58.6 lbs for beef, 48.9 lbs and pork and 103.5 lbs for broilers.
EXPORTS WERE LOWEST SINCE JUNE 2020
U.S. beef exports continue to slump because of the impasse with China and lower year-on-year production. September beef exports were just 80,835 metric tons (mt), down 22% from a year ago and the lowest monthly total since June 2020. Export value was $660.9M, also down 22% and the lowest since February 2021. Even when excluding China, beef export volume fell 11% year-over-year, due in part to lower production, says the U.S. Meat Export Federation (USMEF). The September data was delayed due to the recent government shutdown. The data showed a fairly steady performance for U.S. pork exports, matching year-ago value while down slightly in volume.
USMEF is encouraged by the robust and resilient global demand for U.S. pork, especially in Mexico but also in a broad range of international markets, said USMEF President and CEO Dan Halstrom. The situation is obviously much more challenging on the beef side, primarily due to the ongoing impasse with the Chinese government, which continues to ignore its commitments under the U.S.-China Phase One Agreement. U.S. industry losses continue to mount as a result of this lockout and relief simply cannot come soon enough, he said.
The Office of the U.S. Trade Representative (USTR) is conducting a Section 301 investigation of China’s implementation of the U.S.-China Economic and Trade Agreement, popularly known as the Phase One Agreement. A public hearing took place last Tuesday. USMEF submitted comments to USTR detailing China’s failure to meet its Phase One commitments on red meat trade.
Pork exports totaled 233,816 mt in September, down 2% from a year ago, said USMEF. Export value was steady at $683.9M, highlighted by the highest value on record for Mexico (nearly $260M). The value of pork muscle cut exports trended higher in September ($586.2M, up 1%), but pork variety meat exports declined due in part to China’s retaliatory tariffs. Excluding China, September pork and pork variety meat exports were 4% above last year. Through the first three quarters of the year, pork exports were 3% below the record pace of 2024 in both volume (2.16M mt) and value ($6.16 billion), and down just 1% when excluding China. Exports to leading market Mexico and to Central America are poised to reach new annual highs. January-September shipments also increased year-over-year to Colombia, the Caribbean, Hong Kong and Vietnam.
Sept Saw Few Bright Spots For Beef Exports
January-September beef exports totaled 856,023 mt, down 11% from a year ago (and down 4% when excluding China). Export value was down 10% to $7.03 billion. Exports trended higher to leading value market South Korea and to Central and South America, Hong Kong, the Philippines, the Dominican Republic, the Bahamas and Africa. But these gains were more than offset by the steep decline to China and lower shipments to Japan, Mexico, Canada and Taiwan, said USMEF.
Although beef exports to South Korea took a step back in September, shipments remained above last year’s pace through the first three quarters of the year. September exports totaled 14,810 mt, down 18% from a year ago, while value fell 20% to $139.3M. January-September exports were 5% higher in both volume (177,717 mt) and value ($1.69 billion). Although Japan remains the leading volume market for U.S. beef exports, September shipments declined 12% from a year ago to 17,018 mt, while value fell 16% to $121.8M. Through September, exports to Japan were down 4% from a year ago at 181,487 mt, valued at $1.34 billion (down 8%).
September beef exports to China sank to just 556 mt, down 96% from a year ago, valued at $2.5M (down 98%). Through September, exports to China fell 57% to 57,050 mt, valued at $486.7M (down 58%). China is now Australia’s largest destination for grain-fed beef exports, with shipments to China up 55% to 132,000 mt from January through November, said USMEF. U.S. beef export volume to Central America also trended lower in September (1482 mt, down 27%) but value still increased nearly 10% to $16.4M. January-September exports to the region increased 2% year-over-year to 16,002 mt, while export value soared 31% to $150.6M. With one quarter remaining, export value to Central America is approaching 2024’s full -year record of $160.2M.
Exports To Mexico Rise In Value
September beef exports to Mexico increased 5% from a year ago in value ($117.3M) despite a 14% decline in volume (16,862 mt), said USMEF. Through the first three quarters of the year, exports to Mexico were down 11% to 154,694 mt, while value fell just 4% to $974M. Although Brazil’s beef exports to Mexico peaked in June at about 16,000 mt, the presence of Brazilian beef remains substantial. The most recent data available is from November, with Brazil’s shipments to Mexico approaching 9000 mt. Brazil is now the largest supplier of beef muscle cuts to Mexico. September beef exports to Canada increased 2% from a year ago to 7661 mt, while value climbed 13% to $73.7M. January-September exports to Canada were 7% below last year in volume (71,858 mt) and 6% lower in value ($659.8M).
Beef exports to the Philippines trended higher in September, increasing 76% from a year ago to 1815 mt, while value jumped 60% to $15.2M, said USMEF. January-September exports increased 20% in volume (13,565 mt) and 10% in value ($106M). Exports to the ASEAN region were substantially lower in both volume (22,513 mt, down 27%) and value ($177M, down 31%) but this was due in large part to lack of access to Indonesia, said USMEF. With shipments to Indonesia recently resuming, exports to the region could perform better moving forward. However, import licenses for 2026 have not been allocated and the additional U.S. beef plants have not yet been added to Indonesia’s eligible facility list, so uncertainty continues for next year, said USMEF.
September beef exports to the Caribbean achieved a 7% increase in value ($20.5M) despite a 10% decline in volume (2220 mt). January-September results followed a similar trend, falling 5% to 23,151 mt but still climbing 12% in value to $231.3M, with value growth led by the Bahamas, the Dominican Republic and Jamaica. Beef exports to Africa were also lower in September (870 mt, down 10%) but still increased 7% in value to $1.6M. Led by growth in Cote D’Ivoire, Morocco and Gabon, January-September exports to Africa increased 11% to 9637 mt, while value climbed 30% to $16M. Beef variety meats account for 94% of total export volume to Africa and about 80% of export value.
September beef export value equated to $337.21 per head of fed slaughter, down 18% from a year ago, said USMEF. The January-September average was down 5% to $393.25. Exports accounted for 10.9% of total September beef production and 8.8% of muscle cuts, down significantly from the respective September 2024 ratios of 13.8% and 11.3%. For January through September, exports accounted for 12.9% of total beef production and 10.7% for muscle cuts, each down about one percentage point from a year ago.
Meanwhile, USMEF said trade relations are shifting after African swine fever (ASF) was discovered in Spain last month for the first time since 1994. Spain is the European Union’s largest pork producer and the number two global pork exporter, trailing only the U.S. Spain’s production was about 27% of EU production thus far this year, said USMEF’s Erin Borror. That’s about 3.88M mt produced January through September. That production is actually on a record pace and is up 6.6% on the same period in 2024, she said.
Some countries, including China and South Korea, hold an ASF regionalization agreement with Spain. As such, China has only suspended imports from establishments located in the Barcelona province, where the confirmed cases of ASF were located. Likewise, South Korea will continue to accept imports from regions in Spain that remain unaffected by ASF. The UK and all EU member states will also accept imports from ASF-free regions of Spain. But other trading partners have suspended all pork imports from Spain, including Japan and the Philippines, which are Spain’s second and third largest non-EU export markets, respectively. Malaysia, which is the sixth largest market and where Spain holds a 35% market share, also suspended all imports, along with Mexico, Taiwan and Thailand. The intra-EU trade continues and Spain obviously has regionalization, and that trade is practically unimpacted, said Borror said. What’s important is the third country trade. Spain is really a success story and something that the U.S. industry should aspire to, she said.