Lean hog futures ended Friday’s session on a weaker footing, with contracts finishing between 17 and 97 cents lower across the board.
The October contract was a modest outlier, managing a 12-cent gain for the week despite the broader softness seen in the Friday close.
Open interest fell by 1,225 contracts on Friday, reflecting reduced market participation as traders assessed the latest supply and demand signals.
The USDA’s national base hog price came in at $78.68 in the Friday afternoon report, slipping 27 cents from the previous day’s reading.
The CME Lean Hog Index also declined, dropping 27 cents on September 23 to settle at $82.20, continuing its recent downward drift.
Managed money traders extended their record net short position in lean hog futures and options by 4,147 contracts in the week ending September 22, bringing the total net short to 35,548 contracts.
The monthly Cold Storage report showed pork stocks at the end of August totaling 436.27 million pounds, representing a 12.03% increase compared to the same period a year ago.
August pork stocks came in 0.81% below the prior month, suggesting some drawdown at the margin even as the year-over-year surplus remains substantial.
The USDA’s pork carcass cutout value rebounded 64 cents in Friday’s afternoon report, reaching $86.74, with the belly primal the only cut reported higher on the day.
Federally inspected hog slaughter for the week was estimated at 2.552 million head, running 68,000 head above the prior week and 19,124 head above the same week one year earlier.
October 2026 hog futures closed at $78.225, down $0.975, while December 2026 contracts settled at $69.025, a loss of $0.450 on the session.
February 2027 hog futures closed at $70.325, down $0.525, as the forward curve reflected ongoing bearish sentiment tied to building supply conditions.
The combination of rising cold storage inventories, elevated slaughter rates, and record managed money short positioning paints a cautious picture for hog markets heading into the final quarter of the year.
