Hogs
Price action: October lean hog futures rose $1.275 to $81.90, near the daily high, hit a two-week high and for the week up $1.025.
5-day outlook: Chart-based specs continue to press the futures market to the downside in early trading today, as technicals remain firmly bearish. However, heavy short covering and perceived bargain buying late in the session pushed prices higher. Prices remain in a downtrend on the daily bar chart. Still-declining cash hog prices also favor the lean hog futures bears. The sell off in the cattle futures market recently is also still bearish for lean hog futures.
The USDA noon pork showed cutout value was up $1.36 at $95.16, led by gains in ribs, hams and bellies. Movement at midday was 159.56 loads. The latest CME lean hog index is down 28 cents to $92.14. Monday’s projected CME index price is down another 62 cents at $91.52. The national direct five-day rolling average cash hog price quote for today is $91.62.
30-day outlook: Historically, the lean hog index weakens from late summer into fall as more hogs reach market weight and slaughter levels rise. The weakening CME lean hog index and national direct prices also suggest a seasonal top in futures as summer demand softens. The shake-up in the cattle industry, with recent plant closures and historically tight cattle supplies, are likely to continue to impact the hog industry and futures markets in the months ahead. Hog traders can argue the situation could be bullish for hogs, given historically elevated beef prices at the meat counter meaning better substitution demand for pork.
90-day outlook: Soft cash hog prices, fading grilling demand and weakening pork cutout values have traders remain bearish heading into fall. Speculators are heavily net short lean hog futures—pushing positioning toward extremes that can fuel sharp short-covering rallies—yet seasonality is still calling the near-term shots. Looking toward year-end the path could brighten. Tighter expected pig crops, resilient export demand, and the usual holiday-season lift may spark a rebound this fall.
What to do: Get current with feed coverage.
Hedgers: You currently have all risk in the cash market.
Feed needs: You have corn-for-feed and soymeal needs covered through September in the cash market.Be prepared to make purchases if value prices continue.
Cattle
Price action: October live cattle futures fell $1.20 to $211.725, near the daily low and for the week down $6.20. November feeder cattle futures lost $1.55 to $309.925, nearer the daily low and for the week down $6.325.
5-day outlook: The cattle futures markets today saw fresh technical selling pressure as both markets remain trapped in price downtrends on the daily bar charts. President Trump today said on social media that his administration will seek changes to allow farmers and ranchers to slaughter and process their own products in response to calls to loosen the grip of the big companies that dominate U.S. meat processing. “I am authorizing legal documents to be drawn in order to allow Farmers and Ranchers to be given the right to PROCESS THEIR OWN FOOD,” Trump said in a post on Truth Social. “This should move quickly.”
USDA at midday today reported active cash cattle trading this week at lower money, with steers averaging $218.65 and heifers $218.63. The agency Monday reported average cash cattle trading last week at $225.01. The noon report today showed mixed boxed beef prices, with Choice grade down $4.97 at $376.39 and Select grade up $2.81 at $362.00. Movement at midday was good at 81 loads. The Choice-Select spread is presently plus $14.39.
30-day outlook: The southern border reopening and President Trump’s move to allow tariff free beef imports aimed at lowering prices have weighed on cattle markets recently, pushing live and feeder futures near nine-month lows. Softening cash fundamentals have compounded the pressure, giving packers the upper hand in deals with feedlots. Better packer margins, helped by tighter slaughter capacity, have lifted recent kill rates and should aid stronger demand as cooler weather sets in this fall. Herd rebuilding remains challenged by a mix of heat, drought, rising grain costs, and the recent decline in fed cattle prices.
90-day outlook: The major U.S. stock indexes recently hit record highs, which is good for upbeat consumer attitudes that could support better consumer demand for beef at the meat counter heading into fall. Recent U.S. inflation reports that showed tamer readings than in previous months are also a positive for consumers. However, retail gasoline prices at the pump that are still elevated have consumers concerned. Demand for beef could be crimped with gasoline prices staying close to $4.00 a gallon at the pumps. Still, U.S. cattle-supply story remains price-friendly. USDA last Friday reported that feedlot placements during July totaled just 1.42 million head, down 11% from a year earlier and the lowest July placement total since the series began in 1996. July marketings were also historically low at 1.62 million head, down 7%.
What to do: You have corn-for-feed and soymeal needs covered through September 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-for-feed and soymeal needs covered through September in the cash market.Be prepared to make purchases if value prices continue.