Traders wasted no time rallying both the live cattle and feeder cattle contracts at Monday's start and all the way through Monday's close as they were encouraged to again see a bullish Cattle on Feed report. Click here to read DTN's Cattle on Feed report comments: https://www.dtnpf.com/….

Although I knew Friday's Cattle on Feed report would be perceived as bullish for the marketplace, I thought traders would be mostly checked out for the week, enjoying the Christmas holiday, merely acknowledging the report but doing little about it. I was quite wrong as the spot February live cattle contract closed $0.62 higher at $231.42, and the spot March feeder cattle contract closed $1.10 higher at $340.50. The spot February live cattle contract was just $0.60 shy of closing at the market's 100-day moving average, but the spot March feeder cattle contract closed $3.60 above its 100-day moving average and at the highest price the market has traded since the end of October.

More than anything, I believe traders' positive interaction throughout the marketplace on Monday again shows hard proof their core desire is to push the contracts higher. I'm personally surprised by the timing of Monday's move simply because it is the week of Christmas. Although there's a sizeable chance later this week the move will be taken back, traders' action throughout the marketplace on Monday shows evidence of their knowledge of the market's fundamentals and long-term trajectory.

It's expected the complex will trade back and forth through the New Year holiday as traders will likely grow less-and-less active in the marketplace the closer the holidays get. However, the real question remains: What are traders going to do after the New Year begins? That's when it will be especially interesting to see how consumer demand fares, how aggressive packers are going to be in the fed cash cattle market, and what will shake out with the feeder cattle complex as domestic supplies are only going to grow thinner and thinner through the late winter and spring. In addition, the wild card of the border reopening still remains on the table. Needless to say, the market may be entering a time in which some holiday disruptions will naturally take place; but there's still plenty to look forward to in 2026.

ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com

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