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Hogs Bounce Back After Friday’s Breakdown
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December Lean Hogs is now the lead contract as its volume has overtaken the volume of the October contract. It opened higher and made the session low 68.525. Price proceeded to rally and made the high at 70.20. It drifted near the high the rest of the session and settled at 69.80. The December contract bounced back after making a new low for the down move on Friday. Friday’s breakdown took price below support at 68.75 with its low at 68.275. The low however was above support at 67.80. The market has been weak, being pressured by a weak cash market, with the cutout and cash indices breaking down to lows not seen since the beginning of the year. Pork has recently been pressured hard after peaking mid-August. Slaughter has been below last year but with weights high, production has climbed above last year and demand hasn’t improved leaving prices in decline as a result, in my opinion. This week has started with a nice turn around in the one-day cutout and futures prices rallied in response. Traders seem to be hoping this is the start of a change in trend for the cutout after its lackluster September performance. We’ll see!... A failure from settlement could see price re-test support at 68.75. Support then comes in at 67.80. If price can hold settlement, it could test resistance at 71.325. Resistance then comes in at 71.825.
The Pork Cutout Index decreased and is at 87.53 as of 09/18/2026.
The Lean Hog Index decreased and is at 84.02 as of 09/17/2026.
Estimated Slaughter for Monday is 493,000, which is above last week’s 482,000 and last year’s 484,690.
Trade Idea:
Buy the February 2027 Lean Hog 74 call
Sell the February 2027 Lean Hog 80 vs 74 put spread.
Cost to Entry - $680 credit plus commissions and fees.
Margin $1,275 per spread.
Maximum risk at option expiration : $1,720 plus trade costs and fees.
**Call me for a free consultation for a marketing plan regarding your livestock needs.**
Ben DiCostanzo
Senior Livestock Analyst
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109
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