6/3/2025 Market Commentary

Live Cattle: Live Cattle futures posted new contract highs in the deferred contracts today, before reversing direction and finishing $3.00/cwt off of their highs. There was no glaring news that led to today’s reversal lower but it definitely felt like fund long liquidation. Boxed beef has been pretty quiet to start this week, as both choice and select have been mildly mixed both days. With the lighter slaughter totals that we continue to see, and the abnormally small slaughter last week, boxed beef should be more supported than the mixed-to-unchanged start it has seen this week. The feedlots will most certainly be asking higher money this week after last week’s record setting sales. Fat cattle in sale barns the beginning of this week are being called $10/cwt higher than a week ago in some instances, and are definitely posting new records for sales. Sometimes the sale barn markets are a reflection of the trade in the country from a week ago, but they are trading higher nonetheless. June Live Cattle options will expire on Friday and the delivery period for June futures will begin on Monday. With the current market and the cash well above the futures, there should be no deliveries against the June contract.

Feeder Cattle: The cash Feeder Cattle market that had become stagnant the past few weeks resumed its higher tone and pushed the futures market to near contract highs this morning. The CME Feeder Cattle index had shed nearly $7.00/cwt over the course of seven days but is now back within a dollar of all-time highs. It is no secret that the number of available feeder cattle is at an all-time low, combine that with the corn market that cannot push higher, and the result is that feedlots are paying record prices for all classes of feeder cattle. As of last Tuesday, the funds were long 33,258 contracts, which is less that 1,000 contracts from their all-time record position. The record cash market is keeping the managed money interested in the Feeder Cattle complex and they are pushing the futures higher.

Lean Hogs: The pork cutout continues to work higher and is pushing the futures higher as well. New contract highs were posted in the August, and further deferred contracts yesterday and again today, and many months finished near those highs today. Open interest continues to flood into the Lean Hog complex on huge daily volumes. The managed money were net buyers of nearly 3,000 contracts for the week ending May 27 and are now long over 95,000 contracts. They are now approaching the upper 25% of their historical levels. The main theme amongst the Lean Hog complex is tighter supplies of hogs going forward, especially later in 2025 and the beginning of 2026, and lighter than expected production currently. Production for the second quarter of 2025 was roughly 4% lower than a year ago and does not look to improve going forward. Friday, we mentioned the gap between the June futures and the current Lean Hog index being $7.20/cwt. That spread has narrowed to $4.32/ cwt at the close of trade today, and will need to be relatively even by the close of trade on next Friday.

Corn: Corn futures started the week with higher trade but ended the day lower on Monday and saw slight gains on Tuesday. The main theme with all the grain complexes, not just the corn, is that there is no threat to U.S. production at the current time. The managed money is currently short just over 100,000 corn contracts and has no reason to exit those positions or even build a long position. Weekly export inspections were great again this week, well above the estimated range and keeps the U.S. well above the pace needed to reach the USDA’s export goal. All eyes will be on the WASDE report on June 12 and if there are any revisions higher to the current export number and in turn, lowering the current carryout. The crop progress report that was released yesterday afternoon showed the U.S. corn crop at 93% planted which is right on the 5-year average. Condition of the U.S. corn crop was also improved 1% from the prior week. Bottom line is the weather looks favorable for the U.S. growing season and the 95.300 million expected corn acres.

Closing Prices

Market Month Last Change
Corn July 438.50 0.25
CHI Wheat July 536.00 3.00
KC Wheat July 536.75 3.00
MN Wheat July 618.00 9.25
Soybeans July 1040.75 7.25
Soy Oil July 46.81 0.53
Soy Meal July 294.50 0.60
Live Cattle June 215.975 0.575
Feeder Cattle August 301.225 0.525
Lean Hogs June 100.225 0.625
Crude Oil July 63.54 1.02
Ch Cutout 366.23 0.23
Sel Cutout 357.54 0.57
Feeder Index 301.48 0.35
Pork Cutout 106.75 0.47
Dollar Index 99.229 0.5230
DOW 42,531 226
National Corn Basis -24.07 0.04
National Bean Basis -48.79 0.78

Dates to Remember

June 6- June Live Cattle Option Expiration

June 12- WASDE Report

June 13- June Lean Hog Expiration

Hog Fundamentals

Current One Week Ago Change One Year Ago Change
Lead Month Future 100.225 99.100 1.125 93.650 6.575
National Cash 95.40 94.86 0.54 89.35 6.05
Index 95.90 92.94 2.96 91.93 3.97
Cutout 106.75 101.46 5.29 101.43 5.32
IA/SMN Cash 96.45 96.45 0.00 90.28 6.17
IA/SMN Weights 288.00 287.90 0.10 288.00 0.00
Slaughter 2,163,000 2,362,000 199,900 2,162,210 790

Cattle Fundamentals

Current One Week Ago Change One Year Ago Change
North Cash 235.31 190.55
South Cash 222.32 185.05
North Steer Basis 20.00 7.51
Choice Boxes 366.23 360.19 6.04 315.60 50.63
Select Boxes 357.54 351.47 6.07 303.70 53.84
Spread 8.69 8.72 0.03 11.90 3.21
Carcass Weights 871 873 2 851 20
Slaughter 477,000 570,000 93,000 538,910 61,910
FC Index 301.48 296.09 5.39 250.77 50.71

Cash Cattle Markets

Region This Week Last Week Last Year
TX/OK/NM $222.00 $184.71
KS $222.32 $185.05
NE $235.31 $190.55
IA/MN $233.56 $190.17

CFTC Disaggregated COT Report

As of: 5/27/2025
Commodity Current Managed Money Change Current Producer/Commercial Change Total OI Total OI Change
Live Cattle 131,293 1,271 -165,025 1,648 408,622 2,007
Feeder Cattle 33,258 714 -12,406 993 77,825 866
Lean Hogs 94,540 2,796 -142,067 1,888 343,292 9,377
Corn -100,760 2,450 -150,061 22,231 1,652,554 8,414
Soybeans 36,697 24,043 -175,974 21,738 875,482 4,106

Live Cattle Markets

August Live Cattle gave up all of its early gains today and finished toward the lower end of today’s range. Resistance above the market will be at 212.850 and then the contract high of 214.500. Support is at the 20-day MA of 209.275 and then 206.375.

Feeder Cattle Markets

August Feeder Cattle broke out to the top-side of their sideways range this morning. Today’s high of 304.550 will serve as the first line of resistance before the contract high of 307.625. Support under the market is at the 20-day MA of 299.700 and then 293.050.

Lean Hogs Markets

July Lean Hogs filled a gap left on February 19 at 105.650 and posted a new high for the move today. Resistance will be at today’s high of 106.050 and then the contract high of 106.700. Support will be at the 20-day MA of 102.600 and then 100.750.

Corn Markets

July Corn traded just below support levels this morning before finishing fractionally higher. Support will be at today’s low of 434 1/4 and then 427 1/2. Resistance will be at the 450 area along with the 20-day MA of 449 3/4.

This material should be construed as the solicitation of trading strategies and/or services provided by Producers Commodities LLC as noted in this presentation. These materials have been created for a select group of individuals, and are intended to be presented with the proper context and guidance. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. These materials represent the opinions and viewpoints of the author, and do not necessarily reflect the viewpoints and trading strategies employed by the IB, Producers Commodities LLC. The trading of derivatives such as futures, options, and over-the-counter (“OTC”) products or “swaps” may not be suitable for all investors. Derivatives trading involves risk of loss and past financial results are not necessarily indicative of future performance. Any hypothetical examples given are exactly that and no representation is being made that any person will or is likely to achieve profits or losses based on those examples. Producers Commodities LLC is not responsible for any redistribution of this material by third parties, or any trading decisions taken by persons not intended to view this material. This material does not constitute an individualized recommendation, or take into account the particular trading objectives, financial situations, or needs of individual customers. Contact designated personnel from Producers Commodities LLC for specific trading advice to meet your trading preferences or goals.

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