Feeder cattle prices are softening just as Washington threatens to flood the market with Brazilian beef — and the futures market is flashing warning signals that cattle producers cannot afford to ignore. The Trump administration is expected to temporarily reduce beef import tariffs on Brazilian product following a White House meeting between President Trump and Brazilian President Lula — a meeting reportedly arranged by JBS co-owner Joesley Batista, a Brazilian billionaire whose company stands to be among the primary beneficiaries of any tariff reduction. Futures tumbled on that news before partially recovering, adding to an already volatile week that saw prices swing in both directions as traders weighed geopolitical headlines against increasingly uncertain fundamentals. In this Tuesday Market Update for May 12, 2026, Brock and Jim break down the latest cash and futures market numbers, including feeder steer prices across the 500–549 and 600–649 pound weight classes, which have both given back a few dollars from mid-April highs. Near-term model forecasts show a modest dip before a gradual recovery — but Brock is clear that those projections assume the Brazil trade situation doesn't materially escalate. With front-month futures sitting at $371.87 and deferred contracts trading at a significant discount to cash, the pair dig into what it actually means to try to hedge cattle in a market with no carry, and why that combination of record cash prices and discounted futures can be more dangerous than it looks on the surface. Jim draws on a firsthand account from 1994, when strong feeder prices masked a treacherous hedging environment that left unhedged operators badly exposed when markets turned. The history lesson lands with real force given today's conditions: live cattle prices have risen 525 percent since 2022, packer bids are showing no urgency, and feedlot operators trying to forward price cattle are essentially being told by the board to take less than today's cash market is offering. Brock and Jim also examine the role of a single JBS principal in brokering what is ostensibly a diplomatic trade meeting, and what that level of private sector influence means for US cattle producers trying to assess whose interests are shaping federal trade policy. Rounding out the episode, Brock and Jim cover the broader macro picture pressing down on the cattle sector from multiple directions simultaneously. The UN's Food and Agriculture Organization reported that global food prices climbed in April to their highest level in more than three years, driven in part by the effective closure of the Strait of Hormuz following the Iran war — a supply chain disruption that is pushing energy costs, fertilizer prices, and transportation costs higher across agriculture. On the demand side, the ongoing H5N1 avian influenza outbreak — with losses now topping 200 million birds since 2022 — has provided structural support for beef demand as consumers shift toward alternative proteins, while a steady April jobs report with unemployment holding at 4.3 percent signals that consumers still have spending capacity. Brock and Jim make the case that producers who understand all of these variables together — not just the cash price — are the ones best positioned to stay solvent through whatever comes next.