2026 MARKET OUTLOOK SHOWS MORE HIGH PRICES – DON’T RISK LOSING THEM
By Larry Stalcup | Contributing Editor
P rice volatility has done a whammy on cattle markets re- cently, causing major swings in feeder cattle and fed cattle markets. The outlook for 2026 markets still looks strong, but prices will likely face as much or more volatility, which puts added pressure on managing financial risk. Herd rebuilding has started slowly, but some producers hav- en’t recovered enough from droughts to have enough grass for expansion. And with continued high cattle prices and strong demand, cattle supplies will get tighter before they expand, contends Stephen Koontz, Ph.D., Colorado State University livestock marketing economist. “Heifers have to be held and cows have to be held,” he says. “There is some evidence of holding cows, but nothing yet on the heifers. We will see in January with the USDA cattle report. I think the news there will be tepid.” These supply-and-demand fundamentals spell high prices.“The cattle and beef outlook for 2026 is the easiest job I’ve had since doing the cattle and beef outlook for 2025,” Koontz says.“As long as demand remains strong, there will be excellent cattle prices.” Koontz forecasts that, for the first quarter of 2026, 500- to 600- lb. calves will average from $400 to $420/cwt. His second-quar- ter projections are between $410 to $430; third quarter $430 to $450; and fourth quarter at $425 to $450.“Again, tight supplies will continue into 2026,” he says.“We should not expect increased supplies of calves for two or three years.” For 700- to 800-lb. feeder cattle. Koontz projects first-quarter feeder prices at $325 to $350/cwt.; $335 to $365 for the second
quarter; $345 to $375 for the third; and $350 to $365 for the fourth. For fed cattle, tight feeder supplies will help hold prices firm but could face “huge pressure from cheapening other meats,” a potential shift in consumer income and continued inflation, Koontz says. He forecasts first-quarter fed prices at $225 to $235/cwt; second quarter at $230 to $250; $240 to $250 in the third; and $225 to $240 in the fourth. He sees cow prices also remaining high due to cow shortag- es and the demand for more burgers.“They will likely range between $165 to $199/cwt. all year, with prices higher in the summer and fall,” Koontz says.“Ground beef will be the most affordable beef product. That consumer demand and more herd building will keep cow numbers low.” Demand Risk Consumer food-buying habits are a threat to cattle prices.“The greatest potential weak link is beef demand. The risks are all downside,” Koontz says.“Some weakening of the economy, relatively low substitute meat prices in pork and chicken and continued inflation could put pressure on cattle markets. Again, the risks are to the downside with generally very strong prices.” As cattle prices remain strong, packers continue to feel more pressure.“The other risks are market disruptions from admin- istrative edicts, and I believe we will lose packing capacity over the next two years,” Koontz contends.“There are not enough animals [for slaughter] now and for the next several years. We have much more capacity than animals. Packer problems will be the thing we talk about more through 2026.”
The magnitude of the volatile Live Cattle futures market is illustrated in this CIH graphic. The huge price swings and value per head show the importance of financial risk management. Photo courtesy Mike Mohoney, CIH
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