THE cash live cattle and wholesale beef markets continue to weakeneven thoughslaughter levels and fed beef production remain well below the levels of a year ago. Total slaughter the week before last was down 10% from the same week last year while weekly beef production was down 8.9%. Analysts continue to be concerned about the record high retail beef prices and their possible impact on demand. Pork is entering an advantageous price relationship versus beef and chicken, says Andrew Gottschalk, HedgersEdge.com. Pork is approaching a price relationship versus broilers that was achieved only one time prior to this year, in 2009. In conjunction, beef is becoming overpriced historically relative to pork. These price relationships clearly demonstrate that caution is warranted regarding beef demand going forward. This concern will be exacerbated if the economy slows and consumers pull back on spending, he says.
Boxed beef cutout values collapsed again last week, as they did the prior week. The national weekly cutout the week before last averaged $393.06 per cwt, down $11.31 per cwt from the week before. The Choice cutout averaged $391.87, down $10.84 per cwt, while the Select cutout averaged $372.65, down $7.95 per cwt. Formula-priced sales accounted for 53.1% of the total volume of 6983 loads. Spot market sales accounted for 30.0%, forward sales accounted for 16.9% and export sales accounted for 9.9%. The Choice cutout the first four days of last week declined by $10.08 per cwt to $371.97 per cwt while the Select cutout declined by $6.47 per cwt to $353.45. The four-day spot market volume, however, was larger than normal at 478 loads of cuts.
Live Cattle Prices Fall Again
Cash live cattle prices meanwhile decline for the fifth week in a row. The week before last saw USDA’s 5-area steer price average $237.51 per cwt live or $370.88 per cwt dressed. The live price was down $1.82 per cwt from the previous week, while the dressed price was down $5.27 per cwt. The cash trade last week was again slow to develop. Virtually the only trade through Wednesday was in Iowa-Minnesota and Nebraska, with 2930 head selling at $365 per cwt dressed. A light to moderate trade occurred Thursday morning, with cattle up north selling at $231-235 per cwt live or $365 per cwt dressed. Cattle down south sold at $236-237 per cwt live or $365 per cwt dressed, again confirming the emergence of a premium there.
The current weakness in fed cattle prices should prove to be limited and temporary, says Gottschalk. Seasonally, export beef demand should begin to improve during October, while domestic demand for the holiday period should also begin to show some renewed life, he says. Meanwhile, the closing of the border has reduced feedlot numbers in Texas leading to an improved market compared to the north, says Kevin Grier, Kevin Grier Market Analysis and Consulting. More offerings in the north have allowed beef plants to pull Nebraska cattle into Colorado and Texas. Kansas packers are now forced to buy most of their needs in Kansas. This has helped keep Kansas feedlots current, he says. More from Grier in the next story.
Carcass weights in the latest reported week ended September 13 were higher than the week before, notably for heifers. Steer weights averaged 959 lbs, up 1 lb on the prior week and up 14 lbs on the same week last year. Heifer weights averaged 872 lbs, up 6 lbs from the week before and up 20 lbs from last year. Overall weights averaged 878 lbs, the same as the week before and up 15 lbs from last year. This was the equivalent of adding 9965 head to that week’s slaughter total of 573,378 head, says HedgersEdge.com.
NWS IS IN MARKET CALCULATIONS
THE fact that the issue with New World Screwworm (NWS) is not resolved and its impact on feeder cattle supplies seems to be setting into market calculations. says Kevin Grier, Kevin Grier Market Analysis and Consulting. Last Monday’s big futures increase firmed up the trendline but the undertone remains on a downtrend. The fed cattle basis is stronger than average but not unusually robust. With that noted, given the recent cash performance, it will likely encourage feedlot marketings, he says.
U.S. calf prices fell for the second week, the week before last, notes Grier. Yearling prices also weakened but look firmer than calf prices. Replacement markets are the strongest in the cattle complex and look immune to the margin pressures in the chain. Boxed beef cutout values declined again but it is not unusual for the cutouts to slide into October before rallying in November. With that noted, it was the largest one-week correction of the year. Breadth remains at rock bottom, with none of the seven primal cuts advancing in price, he says.
Packer margins weakened again after showing some tepid bounce in recent weeks, says Grier. (Margins last Thursday were negative by $164.05 per head, according to HedgersEdge.com). The packer tone seems bearish and packers are likely to trim kills again to protect the cutout. July beef demand was excellent and demand in the first half of 2025 greatly exceeded last year. Demand is showing no statistical signs of letting up, he says.
The total slaughter four-week average ending September 20 was down 9% on last year, says Grier. The fed cattle kill four-week average ending September 6 (latest) versus 2024 was also down 9%. The non-fed kill four-week average week ending September 6 (latest) was down 12%. October fed cattle availability is likely to be down 4% compared to last year. Packer negotiated cash and dressed inventories are very tight compared to normal. Packers are more comfortable with October contracts than last year. With that said, contracts are not a major part of U.S. packer inventories, he says.
EUROPE IS RIPE FOR ACQUISITIONS
JBS has made numerous acquisitions in North and South America and in Australia over the past 20 years to make it the world’s largest protein company. Now the Brazilian-based giant is focused on Europe and elsewhere. JBS sees the European meat market as fragmented and therefore full of acquisition opportunities, Wesley Batista, controlling shareholder of the company, said during an event broadcast live. Speaking alongside Marcos Molina, controlling shareholder of rival companies Marfrig and BRF, Batista and Molina answered questions regarding the dominant role of certain Brazilian companies in the global meat trade. No doubt, said Batista, when asked about the prospect of pursuing acquisitions worldwide. There are lots of opportunities in Europe and in other countries, he said.
JBS’s listing in New York earlier this year gives the company access to a wider pool of investors, helping it lower the cost of capital and compete against peers like Tyson Foods in the U.S. and large listed rivals in Brazil, including Minerva, said Batista. But while in Europe the company can still expand via takeovers, in the U.S. and Brazil that would not be the case, given competition concerns that would be raised by antitrust authorities. JBS can’t acquire any more U.S. beef, pork and chicken processors because it has around 20% to 25% of the North American market for these three proteins, he said. The situation is similar in Brazil, making it unlikely for JBS to pursue acquisitions in the local processed foods segment, for example.
Batista also said that the use of drugs like Mounjaro and Ozempic is boosting demand for protein around the world, which is positive for food companies in general. Batista noted that 15M Americans make frequent use of such weight loss drugs, adding that no data is yet available to quantify the rise in meat demand tied to the use of these drugs. Meanwhile, JBS and a number of other top Brazilian companies are attempting to mend relations between the U.S. and Brazil, according to Brazilian media reports. JBS and aviation manufacturer Embraer encouraged a brief meeting last Tuesday at the United Nations between President Trump and Brazilian President Luiz Inácio Lula da Silva, which Trump described favorably.
AUGUST MARKETINGS WERE DISMAL
THE latest Cattle on Feed (COF) report confirmed that August marketings out of feedlots were dismal. Marketings totaled 1.571M head, down 13.6% from August last year. Even after adding 4.5% to account for one less slaughter day this year, they were down 9% from last year. They were also 0.7% lower than analysts’ average forecast. Both marketings and the marketing rate were record low for the month. Feedlots placed 1.780M head in August, down 9.9% from a year ago. They were 1.2% lower than the average forecast. The September 1 COF total of 11.080M head was 98.9% of a year ago and was 118,000 head lower than a year ago. The total was the second lowest level for September since 2017.
Six states, Idaho up 5%, Iowa up 5%, Kansas up 3%, Nebraska up 5%, South Dakota up 5% and Washington up 8%, had more cattle on feed than a year ago. Texas had the most cattle on feed with 2.500M head, with its total down 250,000 head from a year ago. Nebraska was second with 2.430M head, up 110,000 head, and Kansas was third with 2.350M head, up 70,000 head. Only two states placed more cattle in August than last year. Arizona placed 20% more and Washington placed 14% more.
No states marketed more cattle in August than last year. The marketing rate was 14.4%, says Andrew Gottschalk, HedgersEdge.com. Only one previous year, 2015, was the rate even under 16% and the five-year average is 17%. This was also five months in a row for levels under the previous year, down 691,000 head year to date. Placements during August were the fourth lowest on record. The reported level of 1.780M head was down 196,000 head from August 2024 and 270,000 head under the five-year average. This was the fifth consecutive month of placements under the previous year. The total decline so far in 2025 versus the same period in 2024 is 850,000 head, he says.
Regarding placement weights, all categories except the heaviest saw year-on-year declines. The under 600 lb category saw 40,000 fewer cattle placed than last year (355,000 head). The 600-699 lb category saw 40,000 fewer cattle placed (265,000 head). The 700-799 lb category saw 45,000 fewer cattle placed (390,000 head). The 800-899 lb category saw 61,000 fewer placed (420,000 head). The 900-999 lb category saw 10,000 fewer cattle placed (260,000 head) and the 1000 lbs plus category saw the same number placed (90,000 head).
Front-End Decline Remains Elusive
As time passes, the expected decline in the category of front-end loaded cattle versus the prior year remains elusive, says Gottschalk. A continuation of the trend of lower monthly marketings than projected continues to deny this supply from declining below prior year levels. As each successive month falls short of projected marketings, it defers the year-on-year decline by one additional month. During the January-August period, steer and heifer slaughter was down approximately 960,000 head. As each month has passed, this total has continued to increase, resulting in a slowdown of marketings and limiting the drawdown in the front-end fed supply. But there may be some light at the end of the tunnel on the horizon, he says. The differential between the projected total on October 1 this year versus the prior year (2.915M head minus 2.441M head is 447,000) narrows going forward. By January 1, this differential is projected to decline to only 330,000 head and then to finally trend below the prior year by March 1. The projected reductions are in place due successive months of reduced placements seen this year. However, the result ultimately hinges on a more aggressive marketing posture going forward. The failure to do so may limit any price advance into the spring, he says.
Meanwhile, prices for feeders and calves have been on a one-way advance to record high levels, says Gottschalk. During this advance, the tops of cyclical up-trending channels are being challenged. Is this confirmation that cyclical price highs have been achieved for this cycle? The simple answer would be yes. But this cycle differs from the most recent cycle in that aggressive feeder heifer retention has not yet occurred and thus any significant herd expansion has yet to occur. On a positive note, this condition should serve to minimize any decline in feeder and calf prices. One caveat to this outlook would be the resumption of feeder and calf imports from Mexico. Another would be widespread drought in cattle intensive areas, he says.
NWS MOVES DANGEROUSLY CLOSE TO BORDER
THE destructive New World Screwworm (NWS) parasite moves dangerously close to the U.S. border with Mexico. Mexico’s National Service of Agro-Alimentary Health, Safety and Quality (SENASICA) on September 21 announced that a new case of NWS had been detected less than 70 miles from the border in Sabinas Hidalgo, Nuevo León. USDA issued its own announcement a few hours later. This case is now the northernmost detection of NWS since the current outbreak began, said USDA. The case is one most threatening to the American cattle and livestock industry, considering Sabinas Hidalgo is located near a major highway running from Monterrey, Nuevo León, to Laredo, Texas, one of the most heavily trafficked commercial thoroughfares in the world it said. Before this detection, the previous northernmost case appeared on July 9 in Veracruz, Mexico, which is approximately 370 miles further south.
It is extremely concerning for the American cattle industry that NWS has moved so far north in Mexico and now is just 70 miles from the border, said Colin Woodall, CEO of the National Cattlemen’s Beef Assn (NCBA). The speed that screwworm has moved through Mexico is a reminder that this pest poses a critical and urgent threat to America’s cattle producers. NCBA appreciates all the resources Secretary of Agriculture Brooke Rollins has invested in protecting American agriculture from NWS. Designating funds for a domestic sterile fly facility, exploring new technologies for sterilizing flies, enhancing fly surveillance and coordinating with other departments across the U.S. government are all important steps for safeguarding the U.S. cattle industry. NCBA is also encouraged by the Food and Drug Administration’s work to authorize emergency treatments for screwworm and it looks forward to additional product approvals, said Woodall.
With the threat so close, the U.S. needs more sterile fly dispersal to push this pest back from the border, said Woodall. Now is the time for USDA to expedite construction of the domestic sterile fly facility and eradicate this pest from the U.S.’s doorstep. NCBA also asks USDA to continue holding Mexico accountable and urge them to reduce animal movements that could spread screwworm north. NCBA is also urging the Environmental Protection Agency to authorize new pesticide products to combat screwworm and provide another tool for American cattle producers, said Woodall.
NWS Is National Security Priority
SENASICA reported that the new case was from an affected 8-month-old cow that had recently been moved to a certified feedlot in Nuevo León from a region in southern Mexico with known active NWS cases. Protecting the U.S. from NWS is non-negotiable and a top priority of the Trump administration, said Rollins. This is a national security priority. The U.S. has given Mexico every opportunity and every resource necessary to counter NWS since announcing the NWS Bold Plan in June 2025. Nevertheless, American ranchers and families should know that USDA will not rely on Mexico to defend the industry, the U.S. food supply or Americans’ way of life. USDA is firmly executing its five-pronged plan and will take decisive action to protect U.S. borders, even in the absence of cooperation. Furthermore, USDA will pursue aggressive measures against anyone who harms American livestock, she said. U.S. ports remain closed to imports of cattle, bison and horses from Mexico.
USDA, alongside Mexico, since July has actively monitored nearly 8000 traps across Texas, Arizona and New Mexico. As of September 21, more than 13,000 screening samples have been submitted, with no NWS flies detected. USDA is currently analyzing the new information related to the Nuevo León case and is considering releasing sterile flies in the region if necessary. USDA is analyzing all new information related to the case in Nuevo Leon and will pursue all options to release sterile flies in this region as necessary, it said. The closure of the U.S. border to Mexican cattle due to NWS fears has constricted already tight feeder cattle supplies, pushing Chicago cattle futures for feeder cattle to record highs. Earlier NWS cases prompted the U.S. government to keep its border closed to Mexican cattle imports since May.