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August Lean Hogs opened lower and broke down to the session low at 111.30. The early breakdown took price below support at 111.675 but it stopped short of taking out the Wednesday low at 110.825. Price was able to turn higher and it rallied to the session high at 112.95. The rally took price to the 112.975 resistance level, stopping just under it. It consolidated the rest of the session settling near the high at 112.45. Both the high and the low were within Wednesday’s trading range forming an inside candlestick. In fact, since August took over as the lead contract on Monday, it has been in a range as traders try to figure out if the cash market is going to sustain its upward expanse. The range is from the June 17^th high at 113.35 to the 105.00 low established when August took over as the lead contact(based on volume) on Monday. The cash market has been able to maintain its strength with the indices continuing to push higher. Will it last? Exports rebounded this week as Mexico came back and purchased 16,200 MT of pork, taking our exports back up to 28,200 MT. This put exports close to the 5-year average for the week at 28,520 MT. Production has been soft and weights are down showing a very current market. This  has helped bolster the price action along with good consumer demand. We get the Hogs and Pigs report on June 26^th. This will give a look to the future for pork production and right now it is likely to expectations are for a bullish report because we are seeing strong deferred month price action. We’ll see!... If Hogs can hold settlement, it could re-test resistance at 112.975. Resistance then comes in at 114.675. A failure from settlement could see price re-test support at 111.675. Support then comes in at 109.85.

The Pork Cutout Index increased and is at 118.90 as of 06/19/2025. 

The Lean Hog Index increased and is at 107.59 as of 06/18/2025.

Estimated Slaughter for Friday is 461,000, which is above last week’s 435,000 and below last year’s 468,910. Saturday slaughter is expected to be 15,000, which is below last week’s 20,000 and last year’s 45,579. The estimated slaughter for the week (so far) is 2,365,000, which is below last week’s 2,375,000 and last year’s 2,412,212.

August Feeder Cattle opened higher and rallied to the high at 307.95. The rally was done by mid-morning and it spent the rest of the session breaking down, reaching the low at 302.00 at the close. It settled near the low at 302.45. The rally stalled just over resistance at 307.675. There is a confluence of resistance here that the market couldn’t overcome. Moving average resistance coincided with the key level as the declining 8-DMA is now at 307.675 and the flattening 13-DMA is just below it at 307.575. There is another key level at 306.90. With the Feeder index under some pressure this week, it didn’t take much for traders to say get me out before the Cattle on Feed report(see below). Once the selling started, attitudes changed and the rout was on. The selling stalled just above support at 301.90. The breakdown also took price below the rising 21-DMA now at 304.275.  This is another negative for the Feeder market. It also put in a bearish reversal pattern on the weekly chart as an Evening Star pattern has formed over the last 3-weeks. In my opinion, this is a major negative, occurring at all-time high prices. The 8-week moving average is at 301.575. This has to hold or Feeders could be in trouble. We’ll see!... A breakdown from 301.90/ 301.575 could see price test support at 299.90. Support then comes in at 297.80. If settlement holds, price could test resistance at 304.325 and the rising 21-DMA. Resistance then comes in at 306.90. 

The Feeder Cattle Index decreased and is at 310.99 as of 06/19/2025. 

August Live Cattle gap opened higher and then closed the gap before rallying to the high at 213.875. The rally also stalled at mid-morning, just under the declining 8-DMA now at 214.15. The 8-DMA has just crossed below the flattening 13-DMA, which could indicate more weakness ahead for Live Cattle. The market then broke down to the low by late morning at 209.375, drifting into the close to settle near the low at 209.825. The breakdown took price just below the rising 50-DMA now at 209.90. This is another negative for the price action, in my opinion. The good thing is the 50-DMA is rising and settlement was just under the moving average. It wouldn’t take much to get back over the 50-DMA. The breakdown in futures could have been some lightening in front of the Cattle on Feed report which was to come out after the close, but it hurt the cash market this week as it failed to make new highs and saw a pullback in price. We will likely see a lower 5-area average price for the week for the first time in a long while. The Cattle on Feed report was neutral as the numbers were in line with expectations, but, the low placements in my opinion is bullish for the market, continuing to show there is less cattle out there entering the feedlots. We have a lot of video auctions coming up till August which could change the landscape. How much will go to grass and how much to the feedlots? Cutouts were strong this week until Friday. It set a new record price (except for the pandemic) at 393.79 for choice, but saw a pullback on Friday. The packer continues to keep low slaughter numbers, helping drive up the cutout as the retailer needs product and with less product being marketed, they have to be aggressive. But the load counts have been minimal. Could this indicate a potential for a decline in consumer demand? The lower slaughter has not been met with an increase in weights as weights have mostly been in decline and the choice/ prime  grading has peaked. This could indicate the feedlots are current and that the packer efforts to back up cattle isn’t accomplishing what it needs in order to regain control of the price action, in my opinion. We’ll see!... If price can’t hold settlement, it could test support at 208.80. A failure from here could see a test of support at 207.725. If price can hold retake the 50-DMA, it could test resistance at 210.975. Resistance then comes in at the rising 21-DMA now at 212.75.

Boxed beef cutouts were mixed as choice cutouts fell 3.29 to 390.50 and select increased 2.36 to 376.95. The choice/ select spread narrowed and is at 13.55 and the load count was 93.

Friday’s estimated slaughter is 102,000, which is above last week’s 100,000 and below last year’s 118,108. Saturday slaughter is expected to be 1,000, which is below last week’s 2,000 and last year’s 18,096. The estimated total for the week (so far) is 554,000, which is below last week’s 558,000 and last year’s 615,577.

The USDA report LM_Ct131 states:  So far for Friday, negotiated cash trade has been mostly limited on moderate demand in the Southern Plains with a few early purchases at mostly 228.00, but not enough for an adequate market test. The latest established market in the Texas Panhandle was last week at 235.00. The latest established market in Kansas was last week at 235.00. Negotiated cash trade has been limited on moderate demand in Nebraska and the Western Cornbelt. The latest established market in Nebraska was Wednesday with live purchases at 236.00 and dressed purchases at mostly 376.00. The latest established market in the Western Cornbelt was Wednesday with live purchases from 236.00-238.00 and dressed purchases at 376.00.

The USDA is indicating cash trades for live cattle from 225.00 – 240.00 and from 372.00 – 382.00 on a dressed basis (so far).

United States Cattle on Feed Down 1 Percent 

Cattle and calves on feed for the slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 11.4 million head on June 1, 2025. The inventory was 1 percent below June 1, 2024. 

Placements in feedlots during May totaled 1.89 million head, 8 percent below 2024. Net placements were 1.82 million head. During May, placements of cattle and calves weighing less than 600 pounds were 335,000 head, 600-699 pounds were 275,000 head, 700-799 pounds were 450,000 head, 800-899 pounds were 516,000 head, 900-999 pounds were 230,000 head, and 1,000 pounds and greater were 80,000 head. 

Marketings of fed cattle during May totaled 1.76 million head, 10 percent below 2024. 

Other disappearance totaled 62,000 head during May, unchanged from 2024.

**Call me for a free consultation for a marketing plan regarding your livestock needs.**

Ben DiCostanzo

Senior Livestock Analyst

Walsh Trading, Inc.

Direct: 312.957.4163

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