Hogs
Price action: June lean hog futures rose $0.625 to $95.75, nearer the daily high. For the week, June hogs were down $3.00.
5-day outlook: The lean hog futures market paused today, following this week’s steep downdraft that drove prices to a five-month low on Thursday. Bears are in firm technical control amid a price downtrend firmly in place on the daily bar chart.
The latest CME lean hog index is up 7 cents to $91.07. Monday’s projected cash index price is down 19 cents to $90.88. The national direct five-day rolling average cash hog price quote for today was $93.57. The noon report today showed pork cutout value up $1.00 at $96.64, led by gains in loins and ribs. Movement at midday was solid at 246.48 loads.
30-day outlook: June lean hog futures have seen a near $15 decline from the early February high. Dull movement in the pork cutout value has limited short-covering interest to date, though the Memorial Day holiday serves as the official start to the grilling season.
90-day outlook: A seasonal increase in pork cutout value is likely as summer approaches, especially if consumers look to cheaper pork options versus pricey beef at the grocery counter. However, it is certainly a possibility for cutout to carve mostly sideways pattern throughout the year, as was the case in 2024.
What to do: Get current with feed coverage.
Hedgers: You have 50% of Q2 production hedged with all remaining risk in the cash market.
Feed needs: You should have all your soymeal and corn-for-feed needs covered in the cash market through May. Be prepared to make additional purchases.
Cattle
Price action: June live cattle futures rose $0.15 to $249.30, near mid-range. For the week, June cattle were down $4.60. August feeder cattle futures lost $6.675 to $349.85, near mid-range and hit a two-month low. For the week, August feeders were down $11.60.
5-day outlook: The steep downdraft in the feeder cattle futures market late this week, in which heavy profit taking and weak long liquidation were featured, also limited buying interest in live cattle futures. August feeders are now trending down on the daily bar chart and combined with today’s bearish weekly low close will likely see follow-through selling pressure next week.
Cash cattle prices slipped late this week. USDA at midday today reported active cash cattle trading, with steers averaging $260.88 and heifers $260.85. The agency earlier this week reported cash trading last week averaged $262.85. The noon report today showed wholesale boxed beef cutout values mixed. Choice-grade was down $1.59 at $389.89, while Select-grade gained $0.64 to $386.29. Movement at midday was 53 loads. The Choice-Select spread at midday today was plus $3.60.
Cattle futures traders were expecting a bearish USDA monthly cattle-on-feed report this afternoon–specifically the placements figure. The report was expected to show cattle on Feed as of May 1 at 11.558 million head, which would be 101.6% of the level seen one year ago at the same time. Placements in April were seen at 103.4% of last year, at 1.668 million head. Marketings in April were seen at 90.7% of one year ago, at 1.655 million head. These numbers are from a Reuters survey of analysts.
30-day outlook: The recent cash cattle price rally has built a premium to nearby futures, though late-week action in live and feeder cattle futures lagged as traders paused around headlines of increased beef imports from Mexico in 2027. Still, cattle inventories remain historically tight, supporting record cash trade despite any weakness in futures. Production is lower for the year and grilling season demand is strong, with packers competing for limited supplies. We wouldn’t be surprised to see futures eventually converge higher with cash, as it has multiple times since the beginning of the year.
90-day outlook: News reports this week highlighted the behind-the-scenes jockeying that accompanied last week’s White House decision to hold off on what had been widely discussed plans to issue an executive order temporarily reducing import tariffs on beef. Politico said a split over the plan highlights a dilemma facing President Trump as he walks a tightrope--trying to balance consumer worries about rising grocery prices with his supporters in the U.S. cattle industry. The report said an unnamed senior White House official described the executive order as still a “work in progress.” Cattle producers are watching and waiting.
What to do: Cover corn-for-feed and soymeal needs through May in the cash market. Be prepared to make additional purchases.
Hedgers: Carry all production risk in the cash market for now.
Feed needs: You have corn and soymeal for feed needs covered in the cash market through May. Be prepared to make additional purchases if value prices continue.