DTN Early Word Livestock Comments

Cattle: Steady Futures: Lower Live Equiv: $256.31 -$1.14*

Hogs: Steady Futures: Lower Lean Equiv: $99.95 -$1.83**

*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 chart gaps in feeder cattle futures were closed with the strength on Tuesday. There are yet further gaps above the market, but it will take a monumental effort to close those gaps. Live cattle have not closed gaps in the nearby months despite the strength on Tuesday. It will be up to market fundamentals to further support the market. Cattle numbers are tight and will remain that way for an extended period, providing continued support to prices. The concern is whether the weakness in boxed beef over the past weeks will continue or if it will run its course and strong demand will resume. Boxed beef prices on Tuesday were lower with choice down $1.13 at $348.20 and select down $2.46 at $342.16. It was not that long ago when these prices were about $80.00 higher. Cash cattle have not yet traded this week, with expectations of steady cash trading. Today is the last trading day for December live cattle. The February contract will become the front month.

Hog futures showed strength despite limited fundamental news. The July and later futures moved to new contract highs. There is a bullish attitude in the market, which continues to support futures despite the lack of support from cash and cutouts. The National Dairy Direct Afternoon Hog report did not show any price change due to limited trading. This may be the cash action on Wednesday as well as on Friday due to the limited trading of hogs. Pork cutouts took a hit with values down $1.83. Traders seem to feel this will be temporary and strong demand will continue after the holidays.

	BULL SIDE		BEAR SIDE
1)	Nearby live cattle contracts have chart gaps above the market that may be filled soon.	1)	Boxed beef prices continue to show weakness, which may indicate reduced consumer demand.
2)	If the cash cattle trade remains steady this week, futures should remain supported, as the limited cattle trade last week and this week may require the packers to be aggressive next week.	2)	Cattle futures may show weakness as traders position themselves for the end of the year to even-up their books.
3)	Deferred hog futures contracts continue to make new highs as trader optimism remains strong.	3)	Hog futures may show weakness as traders liquidate some of their positions by the end of the year.
4)	Traders digested the bearish implications of the recent Hogs & Pigs report with the anticipation of lower hog weights and strong slaughter to overcome the higher number of hogs expected to come to the market.	4)	Further weakness in pork cutouts on Tuesday may put pressure on the market today.

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.