Sometimes, it’s important to look at the competition to see how they’re doing. To that end, a look at graphs of USDA hog-market data compiled by the Livestock Marketing Information Center in Denver shows the pork cutout is falling seasonally but at a higher-than-average level.
The data also show that FOB-plant weekly negotiated price is about to cross under last year’s value.
PORK CUTOUT SINKING
The USDA data had last week’s average pork cutout value at $100.97 per cwt, down $1.87, or 1.82%, from $102.84 a week earlier but up $2.81, or 2.86%, from $98.16 in the same week last year and up $10.10, or 11.1%, from the 2019-2023 average of $90.87. For comparison, last week’s average cutout value was down from the 2025 high of $118.26 the last week of July, a drop of $17.29, or 14.6%.
If the cutout continues dropping at its present rate, it will drop below last year’s next week’s average of $102.35. It could come out on top again in a week or two, though, because last year, the cutout fell off again to a seasonal low of $90.33 per cwt the second week of December before a late bounce into January 2025.
On average, the weekly average high in the pork cutout occurs in the first week of August at $104.33 per cwt only to decline into the December low of $80.98 interrupted by a bump the first week of October at $94.58.
SLAUGHTER HOG PRICES ALSO FALLING
With the pork cutout dropping, it stands to reason that slaughter hog prices would decline as well, and this is what is happening. USDA data showed that last week’s average butcher hog price was $89.72 per cwt, down $3.18, or 3.42%, from $92.90 a week earlier but up $7.05, or 8.53%, from $82.67 in the same week a year ago and up $12.19, or 15.7%, from the previous five-year average of $77.53.
Last week’s average price also was down $17.03 per cwt, or 16.0%, from this year’s high of $106.75 per cwt, which came in the last week of June.
The 2019-2023 average puts the annual high slaughter hog price occurring in the first week of August at $91.92 per cwt before dropping to the December low of $69.54, which occurs the last week of the year. There is a minor seasonal price bump the first week of October that does nothing but interrupt the decline.
Last year, the weekly average slaughter hog price leveled out from August into the year end with a minor bump the second week of November.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers last week ranged from $236.75 per cwt to $249.43, compared with the previous week’s range of $237.30 to $243.18 per cwt. FOB dressed steers and heifers went for $373.38 per cwt to $378.93, compared with $368.29 to $381.29.
The USDA choice cutout Friday was down $0.14 per cwt at $378.13 while select was down $0.87 at $358.65. The choice/select spread widened to $19.48 from $18.75 with 97 loads of fabricated product and 18 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef as $403.11 per cwt, and 50% beef was $160.64.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $0.95 to $1.10 a bushel over the Dec corn contract, which settled at $4.31.1/2, down $0.01 1/4.
No new live cattle delivery intentions were tendered Friday.
The CME Feeder Cattle Index for the seven days ended Thursday was $347.25 per cwt, down $4.75. This compares with Friday’s Nov contract settlement of $338.87, down $2.95.