DTN Early Word Livestock Comments

Cattle: Lower Futures: Lower Live Equiv: $280.88 -$3.65*

Hogs: Lower Futures: Lower Lean Equiv: $116.95 -$1.30**

*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:

Cattle futures may have run out of steam as boxed beef prices continue to show weakness. Demand may be slowing as consumers reduce beef consumption after the summer months. There may be limited downside as cattle supplies will remain tight, but the impact of reduced demand may result in a significant price correction. Boxed beef prices were lower Wednesday with choice down $4.44 and select down $6.80. The weakness of boxed beef is likely to result in lower cash this week. The Cattle on Feed report will be released Friday. During weeks when the report is released, cash trading activity usually waits until the day of the report. The average estimate for on-feed numbers on Sept. 1 is 99.1% of a year ago. Placements in August are estimated at 91.0% and cattle marketed at 87.1%.

Hog futures struggled Wednesday, closing the day lower on another day of limited volatility. There is a lack of fundamental support in the market, resulting in a sideways to lower trend. Traders are questioning the strength of demand moving forward. Pork cutouts have been struggling recently, with values down $1.30 on Wednesday. Packers remained aggressive, with the National Daily Direct Afternoon Hog report up $0.42, and a substantial volume of hogs purchased. They may not be as aggressive the rest of the week as they should have much of what they need on the books. The weekly weights increased by 0.3 pounds, adding to the substantial increase last week and higher than a year ago.

	BULL SIDE		BEAR SIDE
1)	The Cattle on Feed report is expected to show a substantial decrease in placements compared to a year ago.	1)	Boxed beef prices have seen significant weakness recently, which may negatively impact cash prices.
2)	Cattle futures continue to correct as traders are reducing some of their long positions. This may be viewed as a buying opportunity at some point.	2)	Cash cattle are expected to trade lower again this week as packers are not expected to be aggressive.
3)	Pork may be the recipient of increased demand as consumers reduce their consumption of beef due to higher prices.	3)	Weekly hog weights increase 0.3 pounds to an average of 286.6 pounds. This is 3.1 pounds higher than a year ago.
4)	Packers have been aggressive and have purchased a substantial volume of hogs so far this week. Higher weights have not been detrimental, as they need supplies.	4)	Hog futures are trending sideways to lower as the strength in demand is not as anticipated.

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.