Highlights

  • December live cattle settled at 218.975 cents per pound on Wednesday, down 0.225 cents after Tuesday's 3.000-cent gain.
  • Average US packer margins swung to a positive $55.35 per head from minus $34.50 the previous week.
  • JBS's Beef North America unit returned to slightly positive adjusted EBITDA as monthly margins improved from minus 2.9% to 3.9%.
  • Tyson plans to restore a second shift at its Amarillo beef plant, with full two-shift operation expected by summer 2027.

A single week turned packer margins from red to black. The average US packer Margin swung to a positive $55.35 per head from minus $34.50, and December live cattle futures settled at 218.975 US cents per pound on Wednesday 11 November, down just 0.225 cents after Tuesday's 3.000-cent jump. The steadier tone arrives as Tyson Foods (NYSE:TSN) restores a second shift at its Amarillo, Texas, beef plant. Together, the signals suggest the market is rethinking how hard packers and JBS (NYSE:JBS) will compete for a historically small Supply of slaughter-ready cattle.

A Bounce After a Nine-Session Slide

On Friday 6 November the December contract closed at 214.050 cents, its lowest since 2 December, after nine straight losing sessions. Cash fed cattle fell by as much as $11 per hundredweight that week, to $212 in Iowa and $213 in Nebraska.

That trade remained thin. USDA showed no reportable negotiated cash trade for live or dressed steers and heifers on 11 November, and no bids or asking prices had surfaced. Without fresh cash prices, futures have less to anchor them, which can amplify daily swings.

Supply Is Still the Dominant Theme

Wednesday's cattle slaughter was estimated at 107,000 head, down more than 14,000 from a year earlier, and year-to-date slaughter is 7.1% lower because of tight inventories. USDA's November supply and Demand estimates, released on 10 November, lowered forecast beef production for the fourth quarter of 2026 and for 2027 on lower-than-expected feedlot placements. They also cut the 2026 cattle price forecast and raised beef Import forecasts.

Demand is the main question mark. Uncertainty over demand for high-priced US beef, with high petrol costs squeezing consumers, has weighed on futures, and a firmer dollar at a 1.5-year high could weigh on exports if sustained.

Policy: Imports and the Mexican Border

Washington has tried to ease beef prices. In August the administration outlined a plan to pause tariffs on 300,000 tonnes of beef for 90 days, and in September President Trump said beef would arrive tariff-free from Brazil and Argentina.

Live cattle imports from Mexico resumed in late August under a phased reopening of ports at Douglas, Arizona, and Santa Teresa and Columbus, New Mexico, with Nogales, Arizona, listed for 30 November. New World screwworm remains the key risk, with a detection confirmed in Arizona on 28 October and 73 domestic animal cases since early June, 21 of them active. USDA reports no infestations among imported animals.

Packers and Producers

Tyson is the most direct listed exposure. Its beef segment has operated at a loss every quarter since early 2024. On 9 November it said it plans a long-term Partnership with Allied Beef Company, a rancher consortium, and expects Amarillo to return to full two-shift operation by summer 2027. Higher cattle prices raise a packer's input costs, so margins depend on whether boxed beef keeps pace, and chicken, pork and prepared foods diversify the group.

JBS, the world's largest meatpacker, said its Beef North America unit returned to slightly positive adjusted EBITDA under US accounting rules in the third quarter, crediting industry capacity adjustments and the reopening of US-Mexico cattle crossings. Its Brazilian and Australian beef operations could benefit if US import access widens, though that depends on policy.

What Could Change the Outlook

Prices could firm if packers with improved margins bid more aggressively for scarce cattle, or if this week's cash trade confirms the rebound. Weaker boxed beef, softer consumer demand, larger tariff-free imports or a faster return of Mexican feeder cattle could weigh on prices. A screwworm spread that forced border closures would reduce supply over time, supporting prices while hurting packer throughput.

Tyson's report is due pre-market on 16 November. Also watch daily USDA cash cattle reports, Friday's CFTC data, the monthly Cattle on Feed report, the Nogales reopening on 30 November and the next supply and demand estimates on 10 December.