Hogs
Price action: August lean hog futures fell $2.05 to $97.225, nearer the daily low. For the week, August hogs were down $1.125.
5-day outlook: The lean hog futures market sold off today as the chart-based speculators were back at it, pressing the short side. Today’s technically bearish weekly low close also sets the table for followthrough technical selling early next week. A price downtrend remains firmly in place on the daily bar chart.
The USDA noon pork cutout was reported up $3.52 at $101.65, led by gains in loins, bellies and picnics. Movement at midday was good at 214.99 loads. The latest CME lean hog index is up 26 cents to $92.51. Monday’s projected CME index price is up 9 cents at $92.60. The national direct five-day rolling average cash hog price quote for today was $94.71.
30-day outlook: The recent technical selling pressure and rising average carcass weights recently could keep the lean hog futures market under pressure in the coming weeks. An increase in carcass weights suggests producers are holding animals back longer. However, the summer season may lead to some tightening in supplies as weights and slaughter wane seasonally. We do expect a boost in demand for primal loins, ribs and butts as the summer grilling season advances.
90-day outlook: U.S. pork export numbers have been one bright spot for the hog market, with forecasts for continued growth into 2027. The numbers could get even better if U.S.-China trade relations continue to improve.
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 are now hand to mouth for feed needs.Be prepared to make additional purchases.
Cattle
Price action: August live cattle futures rose $0.125 to $241.65, nearer the daily low and hit a two-week high early on. For the week, August cattle were up $2.60. August feeder cattle futures gained $0.525 to $353.90, nearer the daily low and for the week up $5.475.
5-day outlook: The cattle futures markets late this week caught the updraft of bullish notions of NWS now on U.S. soil being price-bullish from a perspective of potentially less cattle supplies coming to market during the peak summertime grilling season. Today’s lower-range close in cattle futures prices does give the bulls some pause heading into trading early next week.
In the Northern Plains, excessive heat expected at some point in the coming week, with highs nearing 100 degrees, may cause some livestock stress.
Cash cattle trading turned active late this week, with USDA reporting at midday today that steers were averaging $256.38 and heifers $256.17. That compares to last week’s USDA-reported cash cattle trading average of $256.86. The noon report today showed higher boxed beef prices, with Choice grade up $0.51 at $393.17 and Select grade up $3.82 at $386.86. Movement at midday was 56 loads. The Choice-Select spread is presently plus $6.31.
30-day outlook: The cattle markets sold off Wednesday, as the bears pushed the short side on NWS uncertainty and its potential impact on U.S. consumer beef demand. And Thursday and today the cattle futures bulls won out the trading day on the upside as markets rallied on ideas the NWS situation will further constrict cattle supplies coming to market for slaughter. So, which camp will in out in the coming days and weeks? We think cattle futures trading will remain choppy and more volatile in the near term.
90-day outlook: Longer-term, the NWS situation could wind up favoring the cattle market bears. Much of the media likes to hype matters, knowing that the more they sensationalize things, the more viewers or clicks their stories will get. A concern in the cattle industry is that U.S. consumers will be spooked by sensationalized news media reports describing NWS and its gruesome effects on animals. For example, the lead paragraph in a Bloomberg story Thursday read: “U.S. authorities are accelerating emergency measures after the flesh-eating New World Screwworm parasite was detected in a three-week-old calf in South Texas, the first animal case reported in the country in almost a decade.” And regarding the bullish NWS aspect of reduced cattle supplies in the U.S. raising prices, such may be the case. However, longer-term, historically high beef prices at the meat counter are likely to diminish consumer demand—especially with gasoline prices at the pump well above $4.00 a gallon. We also expect extended ambiguity around the border reopening will spur increased volatility as herd rebuilding efforts remain dampened by a less-than-ideal weather pattern in the Plains.
What to do: You are hand to mouth for feed needs. Be prepared to make additional purchases.
Hedgers: Carry all production risk in the cash market for now.
Feed needs: You are now hand to mouth for feed needs.Be prepared to make purchases if value prices continue.