Will the Cattle Cycle Turn in 2026?

The CattleFax Outlook Seminar, held as a part of CattleCon 2026 in Nashville, Tennessee, said there are signals showing changes ahead in 2026. The U.S. cattle and beef industry enters 2026 with strong but volatile market conditions, as historically tight cattle supplies, record-setting beef demand, and elevated policy and weather uncertainty continue to support prices, even as markets appear to be near cyclical highs. “Tight inventories and exceptional demand remain the dominant forces shaping the market,” said Mike Murphy, CattleFax Chief Operating Officer. “However, producer demographics, high input costs, and policy uncertainty point to a slow and measured expansion phase.” The Outlook Seminar’s weather forecast is calling for a transition out of La Niña. In the near-term, drought risks remain elevated across the Southern U.S. and Central Plains, with a 70 percent chance of intensification. A neutral spring setup may help distribute moisture more evenly, though lingering La Niña effects could limit precipitation in the West.  

Farmer Sentiment Drops Sharply in January

Farmer sentiment weakened sharply in January as the Purdue University/CME Group Ag Economy Barometer dropped from 136 in December to 113 in January. The Current Conditions Index dropped 19 points while the Future Expectations Index dipped 25 points. Among the five indexes that make up the overall AEB Index, the largest decline was in the question asking participants whether U.S. agriculture would have good times or bad times during the next five years. The index for that question fell from 122 to 88, marking its lowest point since September 2024. One-half of the producers surveyed reported that their farm operations were worse off than a year ago. The respondents expecting a larger operating loan this year compared to last year rose to 21 percent, up from 18 percent last year. Thirty-one percent of those producers say it’s because they were carrying over unpaid operating debt from the prior year, up from 23 percent in 2025. 

Former Ag Leaders Warn of Farm Economy in Crisis

A bipartisan group of former leaders of America’s major agricultural commodity organizations and biofuels organizations, farmer leaders, and former USDA officials issued a stark warning to Congress and the Trump administration. In a letter, they outlined the deteriorating state of the farm economy, calling current conditions a potential “widespread collapse of American agriculture.”  The letter was signed by Harold Wolle (WOOL-lee), former NCGA President, Bob Dineen, the past president of the Renewable Fuels Association, Jim Mulhern, the former President of the National Milk Producers Federation, and many others. The letter proposes many solutions, including immediately exempting all farm inputs from tariffs and repealing tariffs that are disrupting agricultural export markets. Other solutions include passing year-round E15 legislation, a new farm bill, and encouraging the administration to quickly complete a review of the U.S.-Mexico-Canada Trade Agreement. They’re also asking for Trade Promotion Authority for the administration and new farm labor reform.

Ag Groups Join Forces for USMCA Renewal

Forty farm and agricultural groups launched the Agricultural Coalition for the U.S.-Mexico-Canada Agreement, underscoring the deal’s vital role as an economic engine for the U.S. farm economy. The groups are calling for its renewal with targeted improvements. As part of the launch, the group unveiled a new website and kicked off an aggressive ad campaign in the nation’s capital, all of which is designed to promote the benefits afforded to the U.S. ag sector as the administration approaches the mandatory 2026 review. “USMCA is one of the President’s signature achievements and has significantly propelled the ag economy,” said Bryan Goodman, a spokesperson for the new group. “We’re not saying it’s perfect, as some changes are warranted, but we are saying it is of paramount importance to farmers that all three countries renew the agreement.” The agreement has significantly increased U.S. agriculture exports to Canada and Mexico and provided more certainty between the three nations. 

Lawmakers Demand Answers from Syngenta and FFA

Federal lawmakers are demanding answers from the National FFA Organization about its partnership with the Syngenta group. The officials are concerned about the Communist-Party-controlled agribusiness as well as the organization’s push for DEI initiatives. The inquiry is being led by the House Ways and Means Committee and the Congressional FFA Caucus, which say the organization’s relationship with the Syngenta Group raises concerns about foreign influence and whether FFA is operating in line with its stated mission as a tax-exempt nonprofit. House Ways and Means Committee Chair Jason Smith and FFA Caucus co-chair Tracey Mann sent a letter to Scott Stump, CEO of the National FFA organization, demanding documents and answers related to the partnership, Syngenta’s role in shaping internal policies, and the organization’s compliance with federal tax law. “Working with a foreign adversary and prioritizing woke policies raises serious concerns about whether National FFA is complying with the requirements to maintain tax-exempt status,” the lawmakers said. 

CattleCon 2026 Breaks Attendance Record

CattleCon 2026 has broken the all-time event attendance record, with more than 9,400 cattle producers and industry stakeholders converging in downtown Nashville, Tennessee. The largest event of its kind brings the cattle and beef industry together each year for business meetings, education, and engagement. “It is exciting to see thousands of producers gather together with the common goal of moving our business forward,” said NCBA President Buck Wehrbein (WHERE-byne). “The record attendance demonstrates the dedication our producers have toward driving beef demand and creating policy that secures a bright future for the next generation of producers.” NCBA spent a lot of time working on policy priorities during the event. Those priorities included protecting the nation’s herd from foreign animal diseases and enhancing and strengthening U.S. mitigation measures against the inclusion of the New World Screwworm. 

Friday Watch List

Markets

Friday looks to be a mostly quiet session for reports, but traders will tune in at 8 a.m. CST to see if USDA reports any flash export sales. After the close, CFTC will release their Commitments of Traders report which will update trader positions as of Tuesday, February 3.

Weather

A clipper system is bringing some snow and breezy winds to the Great Lakes Friday morning, which will spread through the Northeast as well. A big burst of wind and cold temperatures will follow it into the weekend across these areas. Meanwhile, it will stay rather quiet across the rest of the country with warmer air in place.