Lean Hogs Stage Turnaround Recovery After Monday Selloff

mev_me_maybe · 2025-12-26T05:09:16+00:00

Lean hog futures rebounded on Tuesday, gaining 75 cents to a dollar per contract after Monday's decline. Open interest dropped, indicating profit-taking among bearish traders. The CME Lean Hog Index rose, contrasting with a lower USDA cash price, while pork cutout values saw mixed performance. Slaughter rates slightly decreased, suggesting a tighter supply supported the market's recovery.

mev_me_maybe

2025-12-26 05:09:16

Abstract generation in progress

Lean hog futures had traders smiling on Tuesday. After Monday’s weakness, the market bounced back decisively with gains spanning 75 cents to a full dollar per contract. The short-covering action was evident—open interest dropped 4,899 contracts, signaling some nervous traders taking profits on bearish positions.

Price Action and Market Signals

The CME Lean Hog Index climbed 19 cents to $82.99 on December 12, a solid move that reflected broader strength. However, USDA’s national base hog price told a slightly different story, sliding $3.12 to $69.56 by Tuesday afternoon. The divergence between the index and cash prices is worth watching.

Pork carcass cutout value retreated 33 cents to $98.56 per cwt, though rib and ham primals managed to hold or move higher—a bright spot in the cutout data.

Supply and Demand Backdrop

Federally inspected hog slaughter came in at 494,000 head for Tuesday, with the weekly run at 973,000. That’s 8,000 head shy of the previous week (after Monday revision) and just 1,175 head below last year’s comparable period. The relatively tight supply picture may be supporting this turnaround.

Futures Market Close

Contract closings reflected the bullish Tuesday tone across the board. Feb 26 Hogs finished up $0.925 at $84.775, Apr 26 Hogs gained $0.775 to $89.700, and May 26 Hogs rallied $0.875 to $93.375.

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