DTN Early Word Livestock Comments

Cattle: Lower Futures: Mixed Live Equiv: $286.90 +$0.79*

Hogs: Higher Futures: Mixed Lean Equiv: $125.51 -$2.16**

*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:

The anticipation was for further cash weakness this week, but no business was done before the market closed Thursday. Later in the day, some light cash trade took place at $3.00 to $4.00 lower for both live and dressed cattle. If this is what will take place, it will be the second week of lower cash prices. This may put further pressure on futures. Boxed beef prices were higher, with choice up $0.11 and select up $3.45. This was the first time this week that both categories were higher. The June live cattle contract will go off the board on Monday and may see little movement ahead of the close. Traders remain supportive of feeder cattle even though buyers are showing some resistance to high prices at auctions.

Hog futures slipped ahead of the report Thursday with traders uncertain over the numbers. However, the report was neutral with all hogs on June 1 at 75.1 million head, 100% of a year ago. Hogs kept for breeding totaled 100% and hogs kept for marketing at 100%. These were slightly higher than the trade estimates of 99.8%, 99.9%, and 99.8% respectively. Farrowing intentions were slightly less than expectations, but not enough to cause any significant price reaction. The National Daily Direct Afternoon Hog report showed a decline of $2.51 on low volume. Packers should be more aggressive Friday to finish up purchases for the week. Pork cutout values were down $2.16 with lower prices for all cuts except loins.

	BULL SIDE		BEAR SIDE
1)	Cattle futures have corrected the oversold condition and may have retraced sufficiently to increase buying interest.	1)	Light cash cattle trade took place Thursday at $3.00 to $4.00 lower. This may have set the stage for the week.
2)	The August live cattle contract will take over as the lead month next week and is carrying more than a $12.00 discount to June. Some of that discount may be reduced in the near term.	2)	July may be a pivotal month for beef demand as the dog days of summer may have a greater impact and beef consumption slows.
3)	The Hogs and Pigs report was neutral, which should support the market and potentially result in traders buying the break.	3)	There is a chart gap below the market in the July hog contract. That may be filled before the contract goes off the board in 2 weeks.
4)	Cash hog prices should be higher Friday as packers may need to buy more hogs to fulfill their needs for the week.	4)	The Hogs and Pigs report showed nearly the same level of hogs as a year ago, indicating there may be little concern about supply and limited upside price potential.

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.