Could Livestock Reach Even Greater Heights During the Peak Demand Period in 2025?
Straight-up talking about Q1's cattle futures report here, mate. In a nutshell, live and feeder cattle futures blew past records like a storm. Live cattle smartly closed Q1 at $2.0780 per pound, with the feeders at a steezy $2.8645 per pound. By May 2025—a few short weeks before the grilling season—things got even hotter.
Rising through the Roof: Live Cattle Prices
They had hit a pandemic-inspired low of 76.60 cents per pound back in April 2020, but five years later, they soared to a record high of over 2.75 times higher. The monthly continuous live cattle futures chart shows a bullish pattern of higher lows and higher highs, bumping the beef futures up to $2.14325 per pound in May 2025.
Peeping at the 1960's quarterly chart, you'll see that the May 2025 high took the cattle market to a whole new level.
Feeders Following Suite
Feeders, they were on trend since the 2020 low. The monthly continuous feeder cattle futures chart paints a picture of a soaring price that went from $1.0365 in 2020 to the May 2025 peak of $2.9990 per pound—an over 189% leap! The quarterly continuous feeder cattle chart reveals that the price at $3 per pound in May 2025 was all-time high.
The Reasons Behind the Rise
Operating costs for cattle farmers and ranchers have surged due to factors like rising feed prices, inflation, and higher interest rates. With increased costs, many meat vendors shrank their herds so much that herd sizes plummeted to the lowest level since the 1950s. Consumption stayed strong, causing a rippling effect that pushed live and feeder cattle prices significantly higher.
Tariffs: Twist in the Tail
While many factors have fueled the cattle market, U.S. tariffs on international trade partners could potentially skew prices. The top beef-producing countries in 2024 included:
The USDA's April World Agricultural Supply and Demand Estimate Report highlighted that beef production increased due to heavier dressed weights, higher cow and bull slaughter, which offset lower steer and heifer slaughter. The report also mentioned a decrease in beef exports for 2025 based on recent trade data, Chinese tariffs, and non-tariff barriers to U.S. beef exports.
The Cattle Rally's Only Path: Futures Arena
No ETF or ETN can trace cattle futures prices; the only way to join the party is by embracing the Chicago Mercantile Exchange's live and feeder cattle futures contracts. Each live cattle futures contract manages 40,000 pounds, while each feeder cattle futures contract handles 50,000 pounds.
Don't forget that the trend is your best mate in all markets, whether it's stocks or cattle. The beef market is about to hit its peak demand season at the end of May, and the annual grilling season lasts until early September, when consumption and prices usually spike. Yet, contrary to seasonal patterns, live and feeder cattle prices have ignored traditional trends, marching straight ahead on an upward trajectory over the past five years. So, the smart money's on higher highs in the cattle arena during the coming weeks and months.
- Technology has played a crucial role in the continuous rise of live cattle prices, with monthly charts showing a bullish pattern that would make a chartist's heart skip a beat.
- In the world of finance, investing in cattle futures has been a lucrative opportunity, especially considering the continuous increase in live cattle prices, such as the peak of $2.14325 per pound in May 2025.
- Despite the continuous surge in prices, the weather has remained a non-factor in this story, as live and feeder cattle prices have ignored traditional trends and pushed forward on an upward trajectory over the past five years.
- Looking towards 2025, many expect the technological wool to be pulled over consumers' eyes, as the prices of live and feeder cattle continue to soar, reaching all-time highs for feeders at $2.9990 per pound.
