Cattle Call is an original production of the Nebraska Rural Radio Association, presented by Blue Chip Herefords of Oxford, Nebraska.
The return of Mexican feeder cattle to the United States could change the supply picture heading into 2027, but one livestock market analyst sees the potential for an unusual first quarter, with stronger fed cattle prices supporting feeder cattle values.
Brad Kooima of KKV Trading in Sioux Center, Iowa, says the reopening of additional ports along the U.S.-Mexico border is restoring a source of feeder cattle limited by animal health restrictions.
Kooima said Mexican cattle imports could soon reach 12,000 head per week, potentially climbing closer to 15,000 by the end of October.
“By itself, is that a big number? No. But collectively it’s going to make a little bit of difference as we look down the road.”
Despite the additional cattle entering the country, Kooima remains optimistic about fed cattle prices during the first quarter of 2027.
“I think live cattle could easily get above $240 again, which should influence, you know, I mean, if you’re getting a better price for your fats, usually you’re willing to pay a little more for the feeders.”
That scenario could create a counterseasonal market for feeder cattle.
Kooima said feeder cattle prices typically weaken during the first quarter before establishing a seasonal low near the end of April. However, stronger fed cattle values could help offset some of that pressure.
He pointed to the cattle crush spread – the relationship between feeder cattle costs, feed expenses and the eventual value of finished cattle – as an important factor.
With feeder cattle values high relative to deferred live cattle futures and feed costs, Kooima suggested stronger fed cattle prices could help improve feedlot margins without requiring a substantial decline in feeder cattle prices.
But the longer-term outlook is less certain.
As additional Mexican cattle move into U.S. feedlots, Kooima said producers should consider how that supply could influence cattle available for slaughter later in 2027.
“I prefer to think that far ahead… and so I would encourage others to look at that and go like, yeah, well, by that time, the border will be open for a long time and we’ll have had more time to place those cattle into the south.”
Other Topics Discussed on Cattle Call
- Cow herd expansion: How many beef cows does the U.S. actually need, and could producers eventually rebuild too far?
- Futures markets: Kooima defends public futures trading and its role in price discovery for producers.
- USDA cash reporting changes: Concerns that combining Southern reporting regions could benefit formula pricing without improving transparency.
- Cattle on Feed report: Expectations for placements, marketings and the potential market reaction.
- Beef demand: Seasonal boxed beef trends and the potential for stronger holiday buying.
- Cash cattle trade: Increased negotiated volume, tighter Southern supplies and the movement of Northern cattle south.
