February 21, 2026
MARKETS
Sales prices in the north were $247-$249 live and $388 dressed. Live prices were $1-3 higher and dressed were $6 higher. In the south most cattle sold for $249 live with some sellers passing those bids and additional sales at “over the tops” meaning prices topping $250. Prices in the south were $1-2 higher.
Cattle on Feed Inventory, Placements, Marketings, and Other Disappearance on
1,000+ Capacity Feedlots - United States: February 1, 2025 and 2026
On feed January 1 ..............: 11,823 11,450 97
Placed on feed during January ..: 1,822 1,736 95
Fed cattle marketed during January: 1,869 1,626 87
Other disappearance during January: 60 55 92
On feed February 1 .............: 11,716 11,505 98
There is little to surprise in the monthly COF report. If anything it was slightly bullish with smaller than expected placements.
The U.S. Supreme court ruled that President Trump lacked the authority to deploy tariffs using emergency executive orders. The ruling invalidated many of the President’s levies and the President responded by invoking a portion of the law allowing him to impose across the board 10% tariffs beginning in a matter of days. Just how this ruling and the President’s reactive tariff will impact the beef supply chain is unclear. The President’s tariffs have evolved over the past year with jumps and starts and quick modifications leaving a quagmire of complex rules that will require sorting out as will many tariffs already applied that may qualify for a refund.
Historically, fed cattle prices peak in the April timeframe for the year. The past two years have contradicted that pattern as prices continued to advance into the summer months. This year the April live cattle contract continues to sell discount to the current cash and expiring February contract.
This past week’s slaughter of 516,000 head was down 25,000 from the previous week’s slaughter volume, and 49,000 under last year. The sharp decline in this week’s slaughter will send a jolt through the retail trade and likely set the stage for higher box prices next week. The processors are struggling with large negative margins. Their only recourse is shut down the plant slaughter volumes or close another plant.
Futures closed lower as rumors of the sharp drop in the weekly slaughter volumes circulated. Despite the need for less fed cattle, the cash prices paid for cattle were higher.
Benchmarking. On Tuesday of each week, USDA releases a weighted average price report for all cattle sold the previous week. The report summarizes the distributed price levels for each category of sale such as Negotiated/Formula/Forward Contracts. Beef producers are able to measure the marketing price for their cattle compared to the national averages.
The Comprehensive Fed Cattle Weekly Report offers the most current information on the current status of fed cattle being harvested. The report is published each Tuesday and includes the previous week’s change in carcass weights and quality grading. The latest report shows carcass weights at 954#, 2# higher than the prior week, and 30# heavier than last year. The combined steer and heifer weights can easily be influenced when the proportion of steers to heifers in the weekly slaughter changes. Quality grade was up .1% from the previous week at 88.6%.
The Weekly Steer and Heifer Grading Report is indicative of regional supplies of choice and prime cattle and often is determinative of regional differences is live price. The report is also reflective of the current status of fed cattle offerings in each area.
Forward Cattle Contracts: Forward contracts will always bear some relationship to the corresponding futures month closest to the delivery month for the cattle. Basis levels will move up and down as processors want to add to forward contracts or not. The driver in forward purchases of cattle will always be forward sales of beef. Packers will always be willing to take a price risk off the producer’s plate in return for an extra margin.
The overheated replacement market will slow the forward contracting of purchases this year. The discounted price in the deferred futures contracts will not encourage cattle owners to forward price cattle at a loss. Favorable forward basis levels can always incentivize sellers to enter into basis contracts to be priced later.
Formula and Negotiated Grids. The Price and Distribution Report delineates the various selling methods and net results.
The Cattle Contracts Report details the percent of contracts by volume of cattle and by number of contracts for selling cattle. Formula selling that was once the largest marketing method and still is, but is losing ground to negotiated grids where the premiums and discounts are set but the base price is negotiated.
Beef demand has mostly remained stable despite rising prices. Inevitably the higher the price, the damage to demand. To date it has been slight but there can come a tipping point and everyone is on the lookout for that point. Beef must suffer a loss of marketshare, not because of price, but simply because we are producing less beef.
USDA Prime cuts are carving out a larger slice of the grocery offerings. Many retailers are struggling to market these cuts and often feature discounts to encourage consumption. This is a benefit for consumers who find bargains on premium cuts. Heavy carcasses also are changing the processing specifications for some cuts. Many of the rib cuts are now cutting off the lip to make the ribeye steaks smaller.
The Cutout. Boxe prices improved as news of the small slaughter circulated.
One casualty of the beef marketing efforts has been the highest end products. The Wagu and branded “all natural” specialty items often seen on the meat counter, but always carrying a hefty price tag. These include the USDA Prime cuts and have become more prevalent as quality grade on all cattle continues to break new records. It is not unusual to see packages carrying a discount sticker. They must be sold like all perishables, but unlike most perishables, the consumer experience eating the discounted cuts is not diminished.
Replacement markets
The feeder market is remaining competitively priced as buyers struggle with limited numbers of cattle and find those offered are in strong hands and considered overpriced. Even the most inexperienced buyers of cattle are worried they are paying too much. Placement numbers recovered somewhat in December but will be trending lower most of this year. Hopes for a positive outcome from ownership of new purchases are not high and most operations want to stay in the market but know they are overpaying for cattle. There is a new desperation driving new purchases of owning inventory at any price.
The USDA report indicating 15% more cattle on winter grain fields in Kansas, Oklahoma, and Texas is getting kickback from many operators in those areas. Local cattle owners are reporting less cattle rather than more cattle on wheat and oats. Dry areas like the Texas Panhandle never placed many cattle on wheat, while central and south Texas placements were late and reduced by high prices and limited supplies.
Benchmarking prices for replacement cattle has become a popular pastime. The advances of 40-50% over year ago prices has some operators gasping. A recent video auction brought in some Arkansas calves weighing 320# at $7.25. The dollars per head for some replacement cattle are nearing the price received last year for fed cattle.
The drought monitor is showing some areas of stress. The Texas Panhandle has been a small local spot failing rain or snow this winter. Moisture conditions and wild fire possibilities will play into the rebuilding of the nation’s cattle herd. If the plains is blessed with timely spring rains, the increase in cattle numbers will happen sooner rather than later.
Compared to last week: Feeder steers steady to 4.00 higher. Feeder heifers 5.00-10.00 higher. Steer calves mostly steady. Heifer calves steady to 5.00 higher. Demand moderate to good. Buyers a little more selective for kind and conditions. Trade from northern accounts remains active. Quality mostly average. few attractive. Commodity futures closed today for the Presidents Day Holiday. Rain fell in parts of
the state over the weekend but expected high winds this week will dry it out quickly. Supply included: 100% Feeder Cattle (55% Steers, 44% Heifers, 2% Bulls). Feeder cattle supply over 600 lbs was 65%
Compared to last week: Feeder steers 4.00-8.00 higher. Feeder heifers 10.00-15.00 higher. Feeder condition was much better this week, especially on heifers. In a few instances, well conditioned plainer type cattle brought more dollars than comparable number one cattle. Steer calves 3.00-6.00 higher. Heifer calves 5.00-10.00 higher. Demand very good for all classes of cattle. The spread between No. 1 and No. 2
cattle continued to narrow this week, as quality becomes less of a concern and buyers focus more on securing headcount to fill orders. Yesterday’s high winds caused multiple wildfires in Northwest Oklahoma and the panhandle. Supply included: 100% Feeder Cattle (66% Steers, 31% Heifers, 3% Bulls). Feeder cattle supply over 600 lbs was 76%
Feeder Cattle Cash Index. The index is tracking the moves in cash prices.
Video and Internet Replacement Cattle Auctions. The movement from traditional private treaty sales to Internet auctions has been slow but steady. Producers have chosen this option as the primary marketing tool for most of the cattle offered in the replacement markets. The market that was once dominated by one firm has seen new competition from multiple trade platforms.
National Weekly Feeder Summary released on Friday of each week tracks the national prices by region for last week.
Grain Futures. The unique aspect of corn prices since last season’s harvest has been the flat price and flatter basis. Analysts will begin to estimate the number of acres for this year’s corn crop. Most expect a small decline as crops rotate from last year’s increases in corn acreage. Corn basis levels in Guymon, Oklahoma are at +$.50 — basis the March contract. The basis will soon change to May.
THE HERD MENTALITY
Ask any cattle owner for their opinion on the market and you will usually hear many different spins. Sometimes the rationale is logical, sometimes emotional, and frequently non-sensical. The analysts tend to direct attention towards the numbers and justify their opinions based on evidence-based knowledge or so they say.
Today most views of the market share a lot of common ground. Caution is the watchword and the large majority believe the next move in price direction will be down. Despite the continuing signs of declining supplies of fed cattle, most point to consumer resistance, negative packer margins that may compel the closing of another plant, and recent attacks from the administration determined to undermine prices with more beef imports. Add to those concerns, the recent confusion regarding tariffs.
One observation held by many of those who have spent time in the world of commodities, is “if it obvious, it is probably wrong.” When everyone develops the same view, their actions often negate the targeted outcome. The operator who chooses to leave the pen empty rather than buy another group of cattle thought to have a certain financial loss, may suffer loss of feed sales, but will avoid red ink at the end of the line. Those actions exaggerate and contribute to the opposite outcome.
Could it be that we have yet to see the next level up for cattle prices? Are $300 CWT. fed prices possible this year? Could an 850# yearling costing $365 return a profit? How about a $600 calf weighing 500# or the lightweight 320# calf that sold for $725? These are nosebleed levels of pricing and for those of us who were buying at half those prices not so long ago, nervousness is warranted.
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EXPLANATIONS OF BREAKEVEN/CLOSE OUT TABLES
Regional differences in grain and cattle basises create a difficulty in modeling a national composite for current close outs or a proforma forward look at a breakeven. Readers should consider your own area for adjustments to these models. Most calculations are basis relevant prices in Guymon, Oklahoma.
CURRENT BREAKEVEN PROJECTION
The Cattle Report introduces the FEEDER METER. The report estimates profit or loss for currently purchased feeder steers and projects a result 180 days out. The chart is interactive and updated every 15 minutes in real time based on changes in futures markets in grain and cattle. Corn basis information is based on current trade prices adjusted every two weeks. Feeder prices are based on the USDA index price for 800# steers and fed cattle sales are $2 cwt. premium the appropriate futures contract.
CURRENT CLOSE OUT
The Cattle Report estimates current profit or loss on cattle placed on feed 180 days ago. This report generated from industry averages attempts to simulate a typical close out based on the feeder index for 800# steers 180 days ago. The close out assumes grain was purchased at market each month. Selling prices and interest rates are based on prevailing benchmark quoted prices. This chart will change weekly.
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