DTN Early Word Livestock Comments

Cattle: Steady Futures: Mixed Live Equiv: $253.99 +$1.91*

Hogs: Higher Futures: Higher Lean Equiv: $102.08 -$1.32**

*Based on the formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. The index has been updated to depict recent changes in live cattle weights and grading percentages.)

** based on formula estimating lean hog equivalent of gross packer revenue.

GENERAL COMMENTS:

June live cattle gapped open and held much of its gains on Monday. It reached back to the high at which the April contract was when it went off the board. All live cattle contracts closed at new contract highs. The sharply higher stock and equity markets provided support. Further support came from the WASDE report, which showed USDA's estimate for steer prices in the second quarter up $13 from the April report to an average of $217; the third quarter up $10, averaging $216; and the fourth quarter up $13, averaging $220. Boxed beef prices were higher, with choice up $2.17 and select up $4.06. Feeder cattle futures gapped higher in all contracts, with the August and September contracts closing $6.07 higher. The closing of the Mexican border for cattle imports provided the catalyst to trigger the aggressive buying interest.

Hogs found strength in the news that there would be a 90-day pause in tariffs between the U.S. and China. This would be positive for exports of pork. The June through October contracts gapped open and remained higher. The December and later contracts closed at new contract highs. The National Daily Direct Afternoon Hog report showed cash up $0.82. It is unusual to see packers being aggressive at the beginning of the week. Their aggressiveness may carry over into Tuesday. Pork cutouts did not fare as well, posting a decline of $1.32. The WASDE report showed second quarter hog prices up $5 for the April report, averaging $68; the third quarter up $6, averaging $71; and the fourth quarter up $4, averaging $60.

	BULL SIDE		BEAR SIDE
1)	New highs keep the uptrend intact with no sign of a top. Higher cash prices and strong demand continue to provide support.	1)	The strong increase in cattle futures Monday may have been a knee-jerk reaction to the weekend news. Futures may fall back somewhat as some profits might be taken.
2)	The closing of Mexican cattle imports indefinitely is bullish for the market. Cattle supplies will remain tight.	2)	Feeder cattle futures left chart gaps on the open, which may be filled now that the exuberance may have run its course.
3)	The 90-day pause on tariffs with China should rekindle the demand for pork from them and improve exports.	3)	Hog futures left chart gaps after the strong opening that are likely to be filled near term.
4)	Higher cash to begin the week may indicate demand for pork may be increasing as the calendar moves closer to the summer grilling season.	4)	Monday's weakness of pork cutouts does not indicate solid demand is developing. Traders need to see consistent gains.

For our next livestock update, please visit our Midday Livestock comments between 11 a.m. and noon CST. Also, stay tuned to our Quick Takes throughout the day for periodic updates on the futures markets.

Robin Schmahl can be reached at rschmahl@agdairy.com

(c) Copyright 2025 DTN, LLC. All rights reserved.