Pigs exhibit a blend of performance on Friday
Declining Lean Hog Futures Amid Volatility
The lean hog futures market is currently experiencing a downturn, with prices declining amid volatility. As of August 13, 2025, the prices for the August, October, and December 2025 contracts were $109.55, $91.60, and $83.80 respectively, showing a consistent trend of decreasing prices [1].
The market's volatility is being driven by shifting supply and demand factors. Although hog slaughter has increased compared to last week, it is slightly lower year-over-year. The USDA reported a national base hog price of $112.41, which is actually up $4.16, indicating firmness in cash prices despite futures declines [1].
Despite the short-term downturn, the futures curve displays a significant calendar spread discount toward December, with December futures trading about $25 under August prices, reflecting seasonal dynamics and concerns about supply over the longer term [4].
Earlier in August, there was a brief bullish momentum with August futures hitting a five-week high. However, profit-taking and heavy selling have softened this bullishness [3][5]. The technical resistance for August futures stands near $110, with support around $105 [3].
Large managed money speculators added 1,700 contracts to their net long position in lean hog futures and options by the week ending on August 5 [2]. The USDA's FOB plant pork cutout report from Friday PM was up $1.08 at $117.41 per cwt [2].
The CME Lean Hog Index was up 50 cents at $110.10 on August 6 [2]. The price for October 25 Hogs is $90.675, down $0.250 [1]. The USDA estimated hog slaughter at 2.35 million head, which was 14,000 head above last week but down 29,420 head from the same week last year [1].
All information and data in this article are solely for informational purposes. It is important to note that no positions in securities mentioned in the article were held by Austin Schroeder on the date of publication.
This indicates a cautiously bearish to neutral lean hog futures market with volatility and shifting supply-demand balances continuing to drive price fluctuations. Market factors include US supply/demand, pork cutout values, and global influences such as China’s efforts to reduce pork production to support prices [5].
[1] USDA National Agricultural Statistics Service [2] CME Group Inc. [3] Reuters [4] Bloomberg [5] Farm Journal's Pork Business
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The declining lean hog futures market could influence the broader stock-market, especially for companies heavily invested in the agricultural sector.
Investors might want to keep an eye on the futures curve, as the significant calendar spread discount toward December suggests potential opportunities for long-term investments in the stock-market.
