For those interested I hold a weekly livestock webinar on Tuesdays, and my next webinar will be Tuesday, June 10, 2025, at 3:15 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.
July Lean Hogs opened higher and made the session low at 104.975. Price turned higher and rallied to the high at 107.275. It consolidated near the high and settled at 107.10. The early low was above support at the rising 8-DMA now at 104.65 and the rally took price past resistance at 106.85. The cash market is erupting as cutouts are surging. The cutout broke through the 110.00 barrier and with beef prices at all-time highs (except for the pandemic) the cutout could continue to rally into the summer. This may help cash prices break through its barrier at 100.00. Exports are improving and China was back in the market buying pork. This is good for the pork industry and could help support cash prices. I keep seeing stuff about disease affecting hog supplies and with the deferred contracts running higher, it could be that expectations are for supply to tighten and keep hog prices moving higher anti-seasonally going forward. Slaughter numbers are shrinking and analysts are saying we could see that continue into the fall. We get the Quarterly Hogs and Pigs report at the end of the month so we’ll see what the USDA says about that. The rally was a breakout above its Ledge formation it was in so there could be more upside instore if the cash can hold its gains. We’ll see!… If Hogs can hold settlement, it could test resistance at 107.925. Resistance then comes in at 109.85. A failure from settlement could see price test support at 106.85. Support then comes in at the rising 8-DMA.
The Pork Cutout Index increased and is at 106.91 as of 06/05/2025.
The Lean Hog Index increased and is at 97.57 as of 06/04/2025.
Estimated Slaughter for Friday is 444,000, which is below last week’s 469,000 and last year’s 468,096. Saturday slaughter is expected to be 16,000, which is below last week’s 240,000 and last year’s 40,676. The estimated slaughter for the week (so far) is 2,363,000, which is above last week’s 2,143,000 and below last year’s 2,415,772.
August Feeder Cattle gap opened higher and rallied to the high of the day and a new all-time high at 310.55. The price being at nosebleed prices wasn’t able to sustain the rally and it broke down, closed the gap and traded to the session low at 307.525. Price then drifted in the middle of the range before moving towards the high at the end of the session to settle near the high at 310.15. This is also a new all-time high settlement. The cash market is on fire with feeders surging among all weight classes. Record prices are made then broken and the Feeder Index made another new all-time high with this afternoons’ print at 306.16. Futures are trading at a premium to the index but with what I have been hearing from various producers the index could soar in the coming days. The question is: will these prices make it on the Merc’s index? We’ll see!… A breakdown from settlement could see price test support at the 307.675. Support then comes in at 306.90. Support then comes in at 304.325. If settlement holds, price could test resistance at R1 at 311.20, R2 at 312.40, R3 at 314.20.
The Feeder Cattle Index increased and is at 306.16 as of 06/05/2025.
August Live Cattle gap opened higher and then broke down, closing the gap while trading down to the low at 216.05. The market turned higher and rallied the rest of the session to the high and it is a new all-time high for the lead contract at 219.325. Settlement was near the high also a new all-time high at 218.875. The strength in futures was quite simply the cash market. Cash is king and futures have been lagging. The June contract has been sagging as the South has continued to lag the North by over 10 handles. Texas and especially Kansas has finally started to move higher. I am being told Kansas traded as high as 235.00 and Texas around 230.00. This lit a fire on the June contract. June soared, trading up to 226.75, dragging the August contract along for the ride. The June/ August spread widened some more as traders think June will continue to outpace August. This is a new all-time high for the spot contract which expires at the end of the month. Cash also exploded up North, trading as high as 244.00 on a live basis and 385.00 on a dressed basis. Dressed made a new high this week on Thursday at 386.00. Cutouts are stalling yet the packer who continues to limit slaughter paying ever higher prices. Boy, are they struggling or what? They can’t win as the producer sits back and the packer bids up price. The retailer sits back and waits for slightly lower prices. They get them. What can the packer do? They are stuck between a rock and a hard place and a situation from what customers tell me of their own making. Guys tell me that the packer set this situation up by screwing with the producer and the retailer during the pandemic. Some guys threw their hands up in the air and weren’t holding cattle back to bred with the frustration they had during the crisis. So, we likely have less cattle now then maybe we would have if the packer was a better trade partner during that period. The packers’ panic shows their worry about the tight supply and they are proving they would pay anything to get product no matter what price they sell the beef. They have orders to fill and can’t get enough supply in front of them even as weights go up. The battle continues. We’ll see!… If price trades below settlement, it could test support at 217.75. A failure from here could see a test of support at 215.60. If price can hold settlement, it could test resistance at R1 – 220.00. Resistance then comes in at R2 – 221.30. R3 is art 223.90.
Boxed beef cutouts were mixed as choice cutouts decreased 1.77 to 365.08 and select increased 0.12 to 356.73. The choice/ select spread narrowed and is at 8.35 and the load count was 103.
Friday’s estimated slaughter is 103,000, which is below last week’s 117,000 and last year’s 118,743. Saturday slaughter is expected to be 2,000, which is below last week’s 5,000 and last year’s 6,327. The estimated total for the week (so far) is 582,000, which is above last week’s 477,000 and below last year’s 609,797.
The USDA report LM_Ct131 states: So far for Friday, negotiated cash trade has been light on very good demand in all feeding regions. In the Texas Panhandle, there have been a few live purchases at 232.00, but not enough for an adequate market test. The last market test in the Texas Panhandle was on Thursday at 232.00. In Kansas, live purchases have been 5.00 higher at 235.00 compared to Thursday. For Nebraska, compared to Thursday, live purchases have been 2.00-3.00 higher from 242.00-244.00. The latest dressed market in Nebraska was Thursday at 380.00. Compared to Thursday, live and dressed purchases in the Western Cornbelt have been mostly steady at 240.00 and 380.00, respectively.
The USDA is indicating cash trades for live cattle from 220.00 – 244.00 and from 375.00 – 386.00 on a dressed basis (so far).
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