For those interested I hold a weekly livestock webinar on Tuesdays, and my next webinar will be Tuesday, June 03, 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 102.875. Price turned higher and rallied into late morning to the high at 105.35. It turned lower from the high but came back at the end of the day to settle near the high at 104.925. Excitement is building in the Hogs as the cash market is strengthening. The cutout is rallying, and we should see a jump in the index on Monday morning. Our exports are improving even as China was out of the market on the last report. Demand is strong and supply is tightening as our slaughter numbers and weights head lower. We are in the grilling season and could continue to see cutouts rally as the retail industry tries to buy cheaper product to overcome the high-priced beef products. If they can feature pork going forward, we could see an increase in demand and drive prices higher. The futures rally took price past resistance at 104.35, which puts resistance at 106.85 in traders’ crosshairs. We’ll see!… If Hogs can hold settlement, it could move towards resistance at 106.85. Resistance then comes in at 107.925. A failure from the key level at 104.35 could see price test support at the rising 8-DMA now at 102.475. Support then comes in at 101.975.
The Pork Cutout Index increased and is at 102.58 as of 05/29/2025.
The Lean Hog Index increased and is at 94.13 as of 05/28/2025.
Estimated Slaughter for Friday is 475,000, which is above last week’s 424,000 and below last year’s 481,522. Saturday slaughter is expected to be 254,000, which is above last week’s 10,000 and last year’s 239,377. The estimated slaughter for the week (so far) is 2,163,000, which is below last week’s 2,362,000 and above last year’s 2,162,210.
August Feeder Cattle gap opened higher and rallied to the high of the day at 302.25. The opening rally finally closed the gap from the May 14th low at 301.325 to the May 15th high at 300.80 and It also topped just above resistance at 301.90. On this gap close traders followed the 80-20 – gap rule where price reverses in the direction of the gap after closing the gap. This saw selling come in and take price down to the low of the day at 298.325. The breakdown took price below the key level at 299.90 and it stalled at the 8-DMA now at 298.40. It consolidated into the close and settled near the low at 298.825. The breakdown on Friday could be the result of month-end profit taking that saw Feeder Cattle make a new all-time high at 307.675 for the lead contract. The monthly technical outlook in my opinion ended up as a potentially topping candlestick. We have seen an impressive rally in the Feeder market and the price action in May resulted in a small-bodied candlestick that could indicate indecision and a potential to see a bigger pullback as we head into June. Settlement was in the lower end of the monthly range, which could see more selling if we start the new month in negative territory. Fortunately for bullish traders, however, most of the bearish candles have ben negated on this surge in price. The index, which was released after the close, was higher as cash prices remain unaffected by the futures market. We’ll see!… A breakdown from the 8-DMA could see price re-test support at 297.80. Support then comes in at 293.80. If settlement holds, price could test resistance at 299.90. Follow through to the upside could see resistance re-tested at 301.90.
The Feeder Cattle Index increased and is at 299.30 as of 05/29/2025.
August Live Cattle gap opened higher and rallied to the high of the day at 211.60.The opening run higher took price past resistance at 210.975 and the 21-DMA now at 211.25. It was also a new high for the August contract since taking over as the lead contract. But, with the month coming to a close, profit taking ensued and price quickly reversed course and broke down to the low of the day at 209.25. Bulls tried to get price moving higher after the low, but it failed to hold, and it broke down towards the low at the end of the day to settle at 209.35. The breakdown stalled just below support at the rising 8-DMA now at 209.25 with settlement just above it. The monthly chart in my opinion looks more negative than the Feeder monthly chart as it settled below the opening price for the month. It also closed in the lower end of the monthly range as futures continue to present bearish technical while the cash market continues its bullish run. Cash made another jump higher this week making a new all-time high price on Friday at 237.00 on a live basis as cash participants ignore the price action in the futures. The packer continues to be under siege, having to get aggressive, mostly up north to acquire product. This is with continued slowdowns in the slaughter rate. Are the Cattle on feed numbers off? It seems the packer can’t find product to buy, so they move price higher until they can find willing sellers. This is vastly different from 2017 to 2019 when they would sit back and let the producer squirm before they bought product. Dressed prices also surged to a new all-time high, this time at 376.00. Exports are decent and demand in my opinion is strong, and the cutout price is reflecting this, making a new high on Friday at 366.24(save for the pandemic surge) as the retail industry gears up for the summer. Consumers are loving their beef even as they grumble about the high prices they are paying. That resurgence of the desire to eat beef is one good thing that came out of the pandemic, in my opinion as consumers realized that beef is delicious and good for them. They seem to have found that they like to cook their own beef and continue to try new things. Maybe they will move to cheaper cuts and find new ways to prepare the meat. Cash and futures seem to want to move in different directions, but as we have seen, negative futures patterns seem to be negated time after time by the imposing run up in cash prices. Can the consumer continue to eat expensive beef? Will a negative pattern keep the pressure on futures in the short run? Can cash keep making new highs? We’ll see!… If price trades below settlement, it could re-test support at the 8-DMA. A failure from here could see a test of support at 208.80. If price can overcome resistance at 210.975, it could approach resistance at 214.325. Resistance then comes in at 215.60.
Boxed beef cutouts were higher as choice cutouts increased 0.25 to 366.34 and select jumped 3.01 to 356.65. The choice/ select spread narrowed and is at 9.69 and the load count was 85.
Friday’s estimated slaughter is 117,000, which is above last week’s 97,000 and below last year’s 121,787. Saturday slaughter is expected to be 5,000, which is above last week’s 2,000 and below last year’s 43,345. The estimated total for the week (so far) is 477,000, which is below last week’s 570,000 and last year’s 538,910.
The USDA report LM_Ct131 states: So far for Friday, negotiated cash trade has been light on very good demand in Nebraska and the Western Cornbelt. In Nebraska, compared to Thursday, live purchases traded 1.00 higher ranging from 235.00-237.00, mostly at 236.00. The latest established dressed market in Nebraska was on Thursday with dressed purchases from 365.00-370.00. Trade was inactive on moderate demand in the Southern Plains. Not enough purchases in any other feeding region for an adequate market test. The latest established market in the Texas Panhandle was on Thursday with live purchases ranging from 221.00-223.00, mostly at 223.00. The latest established market in Kansas was on Thursday with live purchases at 222.00. The latest established market in the Western Cornbelt was on Thursday with live purchases ranging from 230.00-235.00 and dressed purchases at 371.00.
The USDA is indicating cash trades for live cattle from 215.00 – 237.00 and from 362.00 – 376.00 on a dressed basis (so far).
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