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Two trade ideas. Long Soybeans and Soybean Meal. Short Fat cattle and Feeder Cattle.
Why is this being considered? My opinion here. If the President and Cabinet Members are talking it up, the mandate is going to be pushed. It doesn’t guarantee it will work but it may set forth a gameplan by the government to sell beans and import meat. Just like the current administration is bent on driving gas and oil lower, we may be on the onset of a similar mandate coming for grains and beef in 2026.
Trump administration mandate. USDA Secretary Rollins appeared on CNBC this morning, repeating the president’s positive rhetoric about trade ahead of next week’s anticipated meeting between President Trump and President Xi. She spoke of the priority that soybeans are as we negotiate trade deals, which in my view is a good sign ahead of next week’s meeting. Rollins also stated that the Administration is on the cusp of a major announcement for onshoring beef production to meet consumer demands. Rollins stated that, “We need to onshore and reshore for our beef producers.” The plan reportedly would make it easier for new smaller processing plants to operate, while also reportedly include opening up more federal lands for grazing. President Trump stated Sunday that the U.S. will be buying more Argentine beef to bring down retail prices here in the States, but Rollins hinted today that the Administration will be unveiling plans in the coming days that would make becoming a rancher easier. She suggested that the announcement may be “perhaps in the next day or two.”
Here is what I am thinking in terms of gameplan in cattle and beans/meal.
Static short in meat vs long in soy.
Strategy #1
Live Cattle June 2026 options
Buy the June 230 puts vs June 200 puts for 600 points or $2400 cost and risk. (Bearish Position)
Soybeans-September 2026 options
Sell the September Soybean 12.50/11.50 put spread for 85 cents or $4250. Max risk is 15 cents plus commissions and fees.
This strategy collects $1850 minus commissions and fees. The maximum risk is $3050 plus trade costs and fees for both spreads combined. The most one could collect at exit is $16,250. But remember we collected $1850 upon entry, for a total collection $18,100 for 1 option 4 way spread. Our goal with this strategy is to collect $ upon entry and exit.
Margin for both spreads combined is $1787.00 as of Oct 21, 2025.
Strategy #2
Feeder Cattle -May 2026 options
Buy the May Feeder Cattle 330/290 put spread for 600 points or 3k per spread plus commissions and fees.
December 2026 Soymeal
Sell the December soymeal 390 vs 330 put spread for 50 points or a 5K collection less commissions and fees.
This strategy collects 2K per spread minus commissions and fees. The maximum risk is 4K plus trade costs and fees for both spreads. The most one could collect at exit is 25K. But remember we collected 2k upon entry, so the total maximum collection is 27k for one 4 way option spread. Again the goal is to collect money upon entry and exit.
Margin for both spreads is combined is $2111.00 as of 10/21/2025.
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Sean Lusk
Vice President Commercial Hedging Division
Walsh Trading
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