Hogs
Price action: June lean hog futures closed a quarter lower at $100.025, near mid-range.
Fundamental analysis: Hog futures opened lower this morning but saw a bounce later in the session as strengthening cash fundamentals continue to support futures. June futures are still trading in a largely sideways pattern, struggling to overcome the psychological $100.00 mark. Bulls are struggling to build on recent momentum despite courts blocking President Trump’s ‘Liberation Day’ tariffs. Traders continue to be keyed in on the cash market. The CME lean hog index is up another 47 cents to $93.52 as of May 27. Packer submission problems have delayed the data necessary for the preliminary calculation, but recent strength points to another modest increase. While the cash index continues to increase seasonally, gains have lagged behind those seen in other years, lacking more robust gains. That has hindered summer hog futures, which continue to trade at relatively modest premiums to the cash market. Strength in pork cutout has likely been encouraging for bulls, as cutout is up another $1.95 to $104.35 at midsession today, led by strength in bellies and hams.
Technical analysis: June lean hog futures opened lower this morning and closed near the open as prices continue to trade sideways on the daily bar chart. Bulls tested resistance at the $100.50 mark today, a close above there would signal a technical breakout, targeting resistance at $101.975. Bulls are seeking to hold support at $99.40, the 10-day moving average, on a break lower, which is reinforced by support at $98.30.
What to do: Get current with feed coverage.
Hedgers: You are carrying all production risk in the cash market.
Feed needs: You have all corn-for-feed and soybean meal needs covered in the cash market through July.
Cattle
Price action: June live cattle rose $1.60 to $215.525, near the daily high. August feeder cattle rose $4.30 to $299.925 and near the daily high.
Fundamental analysis: The cattle futures markets bulls are once again showing resilience following significant price setbacks. There is less risk aversion in the general marketplace late this week, which is also friendly for the cattle futures markets. Cash cattle and beef market fundamentals remain solid. The cash cattle market remains well above live cattle futures, which should continue to support futures prices.
Cash cattle trade has had a slow start to the holiday-shortened week. In very light trade so far, cash prices are averaging $229.80, which compares to last week’s USDA reported average of $226.97. The noon report today showed wholesale beef values continue to work higher, with Choice cutout up $1.25 to $366.67, while Select gained $1.19 to $352.93. The Choice-Select spread is presently $13.74. Movement at midday was 66 loads.
The weekly USDA export sales report is delayed until Friday morning due to the Memorial Day holiday on Monday.
Technical analysis: Live and feeder cattle futures bulls have the firm overall near-term technical advantage. The next upside price objective for the live cattle bulls is to close June futures above resistance at the contract high of $218.625. The next downside technical objective for the bears is closing prices below solid technical support at $210.625. First resistance is seen at this week’s high of $216.425 and then at $218.00. First support is seen at Wednesday’s low of $213.50 and then at this week’s low of $212.50.
The next upside price objective for the feeder bulls is to close August futures prices above technical resistance at the contract high of $307.675. The next downside price objective for the bears is to close prices below solid technical support at this week’s low of $293.05. First resistance is seen at this week’s high of $301.20 and then at $303.00. First support is seen at today’s low of $296.30 and then at $295.00.
What to do: Get current with feed coverage. Carry all production risk in the cash market for now.
Hedgers: Carry all production risk in the cash market for now.
Feed needs: You have all corn-for-feed and soybean meal needs covered in the cash market through July.