DTN Midday Livestock Comments          02/10 11:42

   Cattle Futures Chop Sideways While Hogs Venture Lower 

   Without any fed cash cattle trade developed yet, the cattle futures continue 
to trade mixed. 

ShayLe Stewart
DTN Livestock Analyst

GENERAL COMMENTS:

   The livestock complex is mixed into Tuesday's noon hour as the cattle 
contracts are trading sideways, but the lean hog contracts are mostly lower. 
Still no cash cattle trade has developed and won't likely until Thursday or 
Friday. March corn is up 3/4 cent per bushel and March soybean meal is up 
$2.90. The Dow Jones Industrial Average is up 248.92 points and NASDAQ is up 
10.37 points.

LIVE CATTLE:

   In trying to wait patiently for the week's fundamentals to shine through the 
marketplace, the futures complex is mixed as traders simply aren't willing to 
advance the market at this point without first seeing fundamental reassurance 
develop. February live cattle are up $0.42 at $239.87, April live cattle are 
down $0.02 at $238.17 and June live cattle are up $0.25 at $234.57. It's quite 
likely the market could enter a sideways trading range until it sees what the 
fed cash cattle market is going to accomplish this week. Traders don't want to 
pressure the market's resistance from a technical standpoint, but at the same 
time they believe in the market's long-term, bullish fundamental outlook, which 
is why a sideways trend is most likely to be the theme throughout the remainder 
of the day and until cash cattle begin to trade.

   Tuesday's WASDE report shared a fruitful outlook for the cattle and beef 
markets of 2026. Beef production for 2026 was increased by 185 million pounds 
as fed cattle slaughter is expected to increase, cow slaughter is expected to 
increase, and carcass weights are obviously higher. I personally question what 
leads them to believe fed cattle and cow slaughter speeds are going to increase 
-- as the entire industry knows supplies are historically thin, and that's not 
expected to change in 2026, and potentially not in 2027 either. But as always, 
time will tell. The quarterly steer price projections were bullish as every 
single quarter for 2026 was increased from January's estimates. Steers in the 
first quarter of 2026 are expected to average $238 (up $6.00 from last month), 
steers in the second quarter are expected to average $238 (up $4.00 from last 
month), steers in the third quarter are expected to average $240 (up $3.00 from 
last month) and steers in the fourth quarter are expected to average $245 (up 
$5.00 from last month). Beef imports for 2026 were increased by 50 million 
pounds and beef exports for 2026 remained steady.

   Boxed beef prices are mixed: choice up $2.24 ($370.00) and select down $0.82 
($364.53) with a movement of 74 loads (53.35 loads of choice, 4.31 loads of 
select, 4.17 loads of trim and 11.88 loads of ground beef).

FEEDER CATTLE:

   Without a strong presence seen in the live cattle complex, the feeder cattle 
contracts are also trading mixed into Tuesday's noon hour. But what remains 
interesting about the feeder cattle market's behavior is the deferred contracts 
aren't concerned about what the live cattle contracts are doing and instead are 
trading fully higher, seeming more focused on the market's long-term situation 
of short supplies. March feeders are down $1.35 at $366.10, April feeders are 
down $0.37 at $362.82 and May feeders are up $0.55 at $358.32.

LEAN HOGS:

   The lean hog complex is again trading lower as the market seems to be 
anticipating increased supplies that are soon to hit the market. The last 
quarterly Hogs and Pigs report unveiled more market-ready supplies than what 
the industry anticipated, and there were plenty of hogs noted in the heavy 
weight categories which will meet the consumer in the supply chain at any point 
in time now. But what also remains true is that while the futures complex may 
be scaling lower, pork demand over the last two weeks has been noticeably 
stronger, which one may logically assume is because some consumers are electing 
to purchase pork as opposed to beef as it's a cheaper protein option. February 
lean hogs are down $0.30 at $86.80, April lean hogs are down $0.87 at $95.85 
and June lean hogs are down $0.45 at $109.35.

   The projected CME Lean Hog Index for 2/9/2026 is down $0.15 at $86.32, and 
the actual index for 2/6/2026 is down $0.11 at $86.46. Hog prices on the Daily 
Direct Morning Hog Report averaged $84.92, ranging from $84.00 to $88.50 on 
1,585 head and a five-day rolling average of $85.65. Pork cutouts totaled 
180.09 loads with 158.85 loads of pork cuts and 21.24 loads of trim. Pork 
cutout values: up $0.57, $96.40.

   Tuesday's WASDE report shared a positive outlook for the hog and pork 
markets of 2026. Pork production for 2026 was increased by 60 million pounds as 
both slaughter speeds and carcass weights are heavier than originally 
anticipated. The quarterly price projections for hogs were bullish as well as 
every single quarter saw an increase from January's estimates. Hogs in the 
first quarter of 2026 are expected to average $65 (up $1.00 from last month), 
hogs in the second quarter are expected to average $73 (up $3.00 from last 
month), hogs in the third quarter are expected to average $75 (up $3.00 from 
last month) and hogs in the fourth quarter are expected to average $63 (up 
$2.00 from last month). Pork imports for 2026 remained steady, but pork exports 
increased by 50 million pounds.

   ShayLe Stewart can be reached at shayle.stewart@dtn.com




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