Hog futures dip; pork cutout eases - CME
Beef futures slide as cutout drops, packer margins shrink
18 September 2025
2 minute read
By: Chicago Mercantile Exchange (CME) live cattle futures fell on Wednesday on softening beef prices and declining profit margins for beef packers, Reuters reported, citing analysts.
Some brokers also attributed the weakness to fund-driven technical selling. Commodity funds hold a sizable net long position in cattle futures, leaving the market prone to long liquidation. However, tight US supplies of fed cattle and feeder cattle continue to underpin futures.
CME October live cattle futures settled down 2.350 cents at 231.100 cents per pound and December live cattle ended down 2.475 cents at 232.675 cents.
October feeder cattle fell 5.175 cents to end at 349.125 cents per pound.
With the summer grilling season over, wholesale beef prices have been declining. The US Department of Agriculture (USDA) priced choice cuts on Wednesday afternoon at $388.18 per cwt, down $4.44 from Tuesday and below their September 3 peak of $416.01.
"The choice cutout is quite a ways off of its high, and certainly that is contributing to weakness in futures markets. The packer margins have already fallen back into the red," said Doug Houghton, an analyst at Brock Associates.
Denver-based livestock marketing advisory service HedgersEdge.com LLC estimated packers were losing $52.25 on every head of cattle as of Wednesday.
Still, cash prices for slaughter-ready cattle were not expected to fall far from last week's trades near $240 per cwt.
Meanwhile, traders continue to position for the USDA's monthly Cattle on Feed report on Friday. Analysts surveyed by Reuters on average expected the government to report the number of cattle in US feedlots as of September 1 at 11.097 million head, down 0.9% from a year ago.
Analysts on average estimated the number of cattle placed into feedlots during August would be down 9% from a year earlier and marketings were seen down 12.8% from a year ago.
CME lean hog futures closed slightly lower, following weakness in cattle futures. October hogs settled down 0.050 cent at 97.325 cents per pound and December hogs ended down 0.575 cent at 87.650 cents.
On Wednesday afternoon, the USDA priced the hog carcass cutout at $110.98 per cwt, down $1.30 from Tuesday.
