Weak beef demand in the midst of a recession continued to pressure both feedyard and packer margins during June. Rising unemployment suggests continued weak demand, although margins may improve some in July. Beef supplies remain manageable from a historic perspective, but demand is the overriding factor. Grain prices are only slightly higher compared with May, and pork and poultry production was slightly lower in June. But all classes of cattle moved lower last month under the pressure of negative margins for feeders and packers. A demand boost is desperately needed, and the greatest opportunity lies in growing export markets. The global recession, however, will be the limitation.