Summary

An overview of the cattle crush spread, a futures market strategy that helps feedlots manage price risk by hedging the gap between fed cattle revenue and key input costs like feeder cattle and corn. Explains how the strategy uses a mix of long feeder cattle and corn contracts and short live cattle contracts to protect gross feeder margin. Also shows how stocker operators can use the crush as a retain ownership decision tool by comparing potential finishing returns in futures markets, while noting basis and local costs still matter.