The U.S. beef market presents contrasting dynamics in early December, with cattle feeders facing rapidly deteriorating financial conditions while beef demand remains historically robust, according to LEAP Market Analytics.

Wholesale beef prices are adjusting lower, with the choice cutout projected to slide into the low to mid-$350s per cwt by year’s end and potentially test $340 per cwt during the first quarter of 2026. This decline is largely driven by expected weakness in rib cuts, which typically retreat during winter months.

Boneless heavy ribeyes have traded between $1,375 and $1,475 per cwt since late August. LEAP Market Analytics expects these prices to adjust toward $1,100 per cwt by the end of January. Last year, ribeye prices peaked above $1,500 per cwt in December before plunging to the $950-$1,000 range by February.

Despite near-term price softness, beef demand remains exceptionally strong by historical standards. LEAP Market Analytics’ full-year outlook for wholesale beef demand in 2026 would still outpace 2021 levels, the peak of the “pandemic bubble”, by a respectable margin.

The pending closure of Tyson’s beef processing facility in Lexington, Nebraska has altered the calculus on packer margins for the foreseeable future. LEAP Market Analytics estimates most feedyards enjoyed average net returns exceeding $500 per head for most of the second and third quarters but are rapidly falling below their breakeven point and could be underwater by at least $500 per head by early next year.

Feedyards are getting hammered after loading up on expensive replacement stock and now seeing premiums evaporate for fed cattle. They have started pushing back, weighing on upstream cattle markets.

Cash feeder steer prices plunged from a record $372 per cwt in mid-October to $317 per cwt last week before bouncing back into the mid-$320s at this week’s auction in Oklahoma City.

This newsarticle is part of a more comprehensive beef market analysis. For the full beef market analysis, visit: https://app.vespertool.com/market-analysis/2497