Latest / Professional Ag Marketing Podcast / Hog Market Headwinds | Hog Talk February 11th, 2026

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Hog Market Headwinds | Hog Talk February 11th, 2026 · Professional Ag Marketing Podcast

• 0:02
  SPEAKER_01: Welcome to the Hog Market Talk Podcast.
• 0:06
  SPEAKER_01: Your weekly deep dive into hog market fundamentals, breaking news, and industry insight.
• 0:12
  SPEAKER_01: Trading commodity futures and options involves substantial risk of loss and is not suitable for all investors.
• 0:20
  SPEAKER_00: All right.
• 0:21
  SPEAKER_00: Today is February 11th.
• 0:22
  SPEAKER_00: I've got Luke Wells with us here today.
• 0:24
  SPEAKER_00: He just joined us from the Minnesota Port Congress.
• 0:28
  SPEAKER_00: So I kind of want to start with that this week.
• 0:29
  SPEAKER_00: How was your experience over in Mankato this week?
• 0:32
  SPEAKER_02: Very good.
• 0:33
  SPEAKER_02: Man Cato, the show in Mankato for Minnesota.
• 0:36
  SPEAKER_02: It's it's it's it's a great venue.
• 0:38
  SPEAKER_02: It's well attended, um, well put on.
• 0:42
  SPEAKER_02: A lot of things to celebrate right here in the industry, right?
• 0:44
  SPEAKER_02: A lot of things to go through.
• 0:45
  SPEAKER_02: So uh great event.
• 0:46
  SPEAKER_02: We saw you know good attendance for the show.
• 0:49
  SPEAKER_02: We were really fortunate at our booth, a lot a lot of customers, a lot of friends, a lot of prospects, a lot of industry.
• 0:54
  SPEAKER_02: You know, kind of wraps up our big quote unquote show season.
• 0:58
  SPEAKER_02: Uh, you know, we had South Dakota, kicked it off awesome, Iowa a few weeks ago.
• 1:03
  SPEAKER_02: And, you know, town turned up.
• 1:04
  SPEAKER_02: Minnesota show is great.
• 1:05
  SPEAKER_02: Thanks everybody that stopped by.
• 1:07
  SPEAKER_02: And Mike, you know, it was it was it was it was a good show.
• 1:10
  SPEAKER_02: Now, this we we have had a little sell-off in the futures, I think we're gonna go to next, right?
• 1:14
  SPEAKER_02: But uh still the tone in the pork industry, the whole protein complexes, just lots of really good stuff going on.
• 1:20
  SPEAKER_00: For sure.
• 1:21
  SPEAKER_00: Let's get into that chart action here a little bit.
• 1:23
  SPEAKER_00: April Hogs pulled back uh over a buck and a half today, 93.85.
• 1:28
  SPEAKER_00: So we have pulled off pretty significantly after almost trading$100 there last week.
• 1:34
  SPEAKER_00: What can you tell me a little bit about that hog chart here?
• 1:37
  SPEAKER_02: Yeah, I mean, so let's start in with managed money, right?
• 1:39
  SPEAKER_02: And so like last commitment of traders in the end of last week, I 126 or 8,000 long compared to record long 146 or something.
• 1:47
  SPEAKER_02: I'm kind of pulling that from memory.
• 1:49
  SPEAKER_02: Like, we've had a hell of a run and we've had you know a big appreciation in this market, right?
• 1:54
  SPEAKER_02: And things have been going well.
• 1:56
  SPEAKER_02: Slaughter, you know, has been the last last, you know, last week was a big week, right?
• 1:59
  SPEAKER_02: Or but but you know, this week a little even with the year ago, next week a little smaller, like supply has been manageable.
• 2:05
  SPEAKER_02: Packers have been needing cash hogs.
• 2:07
  SPEAKER_02: You know, this week on the cash hog market, Mike, we 88, 90 printed yesterday.
• 2:11
  SPEAKER_02: That's above index in the 86 type range, right?
• 2:14
  SPEAKER_02: And and you know, so just supply is good.
• 2:17
  SPEAKER_02: Um, but you know, a lot of optimism.
• 2:19
  SPEAKER_02: We almost hit 100 bucks, was it like 99.80, you know, last week.
• 2:22
  SPEAKER_02: So just for some perspective on that, um, not that we can't do that, right?
• 2:27
  SPEAKER_02: But you know, Kate, if you want to bring up like the cutout chart, maybe make sure we throw 21 and 22 on it, then hover your scroll, you know, go to uh, you know, about April 15th at expiration.
• 2:38
  SPEAKER_02: All right, so this is kind of simple math, right?
• 2:41
  SPEAKER_02: But when at a 99 or a hundred dollar April future uh at expiration, you know, we're gonna need that cutout to be probably really close to 110.
• 2:50
  SPEAKER_02: Now, can we do that?
• 2:52
  SPEAKER_02: Have we done that?
• 2:53
  SPEAKER_02: Yeah.
• 2:53
  SPEAKER_02: Um, 21 and 22 if you hover, you know, we we were we were up there at those levels, those were awesome demand years, lots of COVID stimulus, right?
• 3:02
  SPEAKER_02: Um, you know, but last year, a far cry from it, and they really the other years of far cry.
• 3:07
  SPEAKER_02: My point with we got this really nice, you know, run, futures got really excited, cash, everything was kind of going, but cutout.
• 3:14
  SPEAKER_02: Now I'm gonna swing back to cutout.
• 3:16
  SPEAKER_02: And demand is still really good, Mike.
• 3:18
  SPEAKER_02: We're moving good product, and I don't want to sound like I'm whining about a 94 or you know, 93.
• 3:24
  SPEAKER_02: It's been 97, 93, it's kind of found its home around 95, right?
• 3:28
  SPEAKER_02: But the cutouts, it's it's kind of sticking.
• 3:30
  SPEAKER_02: And like Cade showed in that chart, over the next month or two, it is not uncommon to have kind of a flatter, maybe even a slight downturn, you know, in in in the cutout through the Lent season and whatnot.
• 3:42
  SPEAKER_02: And I don't think Lent has the effect it once did, but it still is a thing.
• 3:45
  SPEAKER_02: Still a lot of fish fries around, right?
• 3:47
  SPEAKER_02: And so futures just my whole point is, you know, cash kind of kind of you know, again, good, but Packers cutting some kills, some more Saturdays got cut, you know, cutout kind of hanging in that 95 area.
• 4:00
  SPEAKER_02: Like if we wanted to sustain where we were at, cutout needed to find a new home closer to around a hundred handle than did a 95 handle, and it it hasn't done that.
• 4:08
  SPEAKER_02: And again, I'm not like real bearish the cutout, um, but uh it it just it we we had a little too big a premium, basis was a little too wide.
• 4:17
  SPEAKER_02: February's gonna expire Friday in a few days.
• 4:20
  SPEAKER_02: We were looking at a pretty wider the cut by a few dollars basis.
• 4:23
  SPEAKER_02: It's kind of normalized here at this pullback.
• 4:25
  SPEAKER_02: So, you know, as we looked up, you know, the April's most magnified is that the biggest five dollar drop, if you will, right?
• 4:30
  SPEAKER_02: But summer futures and whatnot pulled back a little bit, and you know, it's just that's it's that's not uncommon.
• 4:35
  SPEAKER_02: It's it's maybe not unhealthy.
• 4:37
  SPEAKER_02: The forward curve, still really good.
• 4:39
  SPEAKER_02: We're not$39 or$40 margin, but$34 or$35, still still a great complex.
• 4:45
  SPEAKER_02: Wean pigs, week to week, new top last week,$122.
• 4:48
  SPEAKER_02: Weighted average turned flat, um, uh, which is normal.
• 4:52
  SPEAKER_02: We're we're off the August.
• 4:53
  SPEAKER_02: Pretty soon the big test, we'll be going off October and the September deliveries, right?
• 4:57
  SPEAKER_02: But uh, you know, this market just it it had really ran.
• 5:00
  SPEAKER_02: It's got a little bit of a setback here.
• 5:03
  SPEAKER_02: Um, you know, and uh, you know, I you know, just just just a little bit of a correction, Mike.
• 5:09
  SPEAKER_02: So I, you know, we never like to see our prices go down, but the pork industry and all, the whole protein complex and all, we're still in a really, really good spot.
• 5:18
  SPEAKER_00: So you wouldn't say there's an incredibly strong catalyst to the setback we've seen.
• 5:22
  SPEAKER_00: Just we went up for a really long, hard time here.
• 5:25
  SPEAKER_00: Yeah, we're pulling back.
• 5:26
  SPEAKER_02: And it looked like the cutout line, I mean, draw a chart, like you say, it should have just kept moving, right, to support that kind of premium, and it just kind of flatlined.
• 5:34
  SPEAKER_02: And again, whining about a$95 cutout, you know, on February 11th, demand's good.
• 5:40
  SPEAKER_00: Well, we saw it a few years ago where we just kind of went sideways so the rest of the year didn't get that summer premium like we normally do from a seasonal perspective.
• 5:48
  SPEAKER_00: So we'll see if uh that trend continues here going forward.
• 5:51
  SPEAKER_02: Yeah, yeah.
• 5:51
  SPEAKER_02: So again, no, we're this gives a chance to reposition and and and you know, modify and whatnot.
• 5:57
  SPEAKER_02: But you know, you know, we we did what was probably a little not disheartening, but a little a little harder to look at today is even though we've had the front kind of moving down, yeah, we've been seeing still some green in that Ach and D's, right?
• 6:08
  SPEAKER_02: Um today they kind of beat up the different words.
• 6:11
  SPEAKER_02: October down$1.30 and D's down$1.40, still at good levels, 91 and 81 and a half.
• 6:17
  SPEAKER_02: I'm rounding there, right?
• 6:18
  SPEAKER_02: But uh, you know, we pushed up and made some new contract ties with those.
• 6:22
  SPEAKER_02: And you know, a little bit of a pullback here today, but uh still, yeah.
• 6:26
  SPEAKER_02: Uh you know, lots of good stuff in front of us.
• 6:29
  SPEAKER_02: Um, you know, kind of moving forward.
• 6:31
  SPEAKER_02: I I think, you know, I don't know if we talked about this on this podcast or looking back, but you know, our team was out at cattle convention last week, and there was a whole awesome podcast on you know on that and whatnot.
• 6:41
  SPEAKER_02: But I for our perk listeners, like something that was kind of neat.
• 6:44
  SPEAKER_02: Uh our RFK uh was out at the cattle convention, spoke to the cattlemen, right?
• 6:49
  SPEAKER_02: And and of course, food pyramid talked about food and protein's the top pyramid.
• 6:53
  SPEAKER_02: That's a good thing.
• 6:54
  SPEAKER_02: That's that's good for all of the protein, right?
• 6:56
  SPEAKER_02: But I, you know, for what our guy said, I mean, he was maybe not quite this blunt about it, but kind of was.
• 7:01
  SPEAKER_02: He's like, just he kind of begged and pleaded the cattleman.
• 7:03
  SPEAKER_02: Quit calling the cowherd, grow the cow herd, right?
• 7:06
  SPEAKER_02: And and you know, that guy's kind of neat to see something at the top level of that, you know, urging that.
• 7:11
  SPEAKER_02: I think another thing, you know, lots of margin, you know, maybe overweight in the cow calf sector here today, right?
• 7:18
  SPEAKER_02: But lots of margin in the cattle complex, a lot of expensive.
• 7:20
  SPEAKER_00: Really protein complex in general.
• 7:22
  SPEAKER_02: Protein complex in general.
• 7:23
  SPEAKER_02: I want some of our guys that went out there, I comment that caught my ear at least is you know, like cowherd, like cowboys, cowgirls, right?
• 7:30
  SPEAKER_02: Are just getting to be fewer and further between.
• 7:32
  SPEAKER_02: Well, innovation.
• 7:33
  SPEAKER_02: They said at the cattle convention, just all the technology, the drones, different things for efficiencies and labor that were out there.
• 7:40
  SPEAKER_00: How to do more with less.
• 7:41
  SPEAKER_02: How to do more with less.
• 7:42
  SPEAKER_02: And there is dollars in that segment right now to get reinvested.
• 7:45
  SPEAKER_02: So um the American rancher, the American pork producer, American farmer all uh continue to be really resilient.
• 7:51
  SPEAKER_02: Um, you know, other things, and maybe I'll make I'll let you kind of lead the talk on this, but you know, end of last week, was that Wednesday or when was Trump's uh China tweet?
• 8:00
  SPEAKER_02: Uh Thursday?
• 8:02
  SPEAKER_00: Yeah, because you saw soybeans really pop off there uh through the back half of last week.
• 8:08
  SPEAKER_00: So really the the big couple days were if uh if you really scrolled through, like no, Tuesday was pretty good on soybeans, uh Friday, um, Thursday, even Wednesday.
• 8:22
  SPEAKER_00: So it Wednesday on through basically today, we've we've had pretty good appreciation through the soybean market here.
• 8:28
  SPEAKER_02: For sure, for sure.
• 8:29
  SPEAKER_02: But but I mean and maybe you agree, maybe you disagree, but perspective, right?
• 8:34
  SPEAKER_02: So and Trump, he he's always for effect.
• 8:37
  SPEAKER_02: I mean, he's always big and those everybody eight million metric ton on top of the twelve that just got done when Brazil is harvesting, when Brazil beans are a buck cheaper in ours.
• 8:48
  SPEAKER_02: And if we did sell eight million more metric ton, like that takes our US carry out like pretty close to scratch, right?
• 8:54
  SPEAKER_00: Yeah, so I mean if we think about it this way, um logical doesn't really have to fit into the conversation.
• 9:00
  SPEAKER_00: But the USDA did pop something into the WASDA report yesterday that basically suggested that, hey, I I know Trump has suggested that China's considering upping to 20 million metric tons for their target this year.
• 9:13
  SPEAKER_00: For them, they argued in the WASD report that the balance sheet for the world doesn't change, the global balance sheet.
• 9:19
  SPEAKER_00: They thought if China does buy that many from the US, you just take that away from other sales throughout the country uh uh to the rest of the world.
• 9:28
  SPEAKER_00: So all in all, the balance sheet globally stays the same, obviously, during trade wars.
• 9:34
  SPEAKER_00: But who it comes from and where things get pushed around just changes a little bit.
• 9:38
  SPEAKER_00: And the USD said the the U the US numbers on the balance sheet probably shouldn't change, even if they do fulfill that.
• 9:45
  SPEAKER_00: I thought that soybeans probably do go up incredibly strong if if they try to even fulfill that duty of eight million metrotons, even if it is completely offset with losing exports to other countries.
• 9:58
  SPEAKER_00: But I found that kind of interesting as well.
• 10:00
  SPEAKER_02: For sure, for sure.
• 10:01
  SPEAKER_02: I think the other thing from an end user perspective, and and again, I I hold some biases, right?
• 10:06
  SPEAKER_02: But I I just I think the US producer, corn for grain produce they they want a little less beans production, but also resilience on China, a little more corn.
• 10:14
  SPEAKER_02: Yeah, right.
• 10:14
  SPEAKER_02: But it's interesting.
• 10:15
  SPEAKER_02: I mean, you ran these numbers, you know, when with this soybean pop, right?
• 10:19
  SPEAKER_02: I mean, it kind of neutralized.
• 10:20
  SPEAKER_02: I mean, around 55 to 60 bucks you're getting closer.
• 10:23
  SPEAKER_02: Yeah, loss on corn or beans, right?
• 10:25
  SPEAKER_02: So maybe just like a take-home, you know, maybe where there was talk 97 plus million acres of corn, maybe that talk goes to 97 to 95.
• 10:35
  SPEAKER_02: Maybe it it it probably saved a few bean acres.
• 10:37
  SPEAKER_02: Maybe could save a few bean acres and all that.
• 10:40
  SPEAKER_02: But yeah, yesterday Wozni, what they up exports corn a hundred million, that's which which which which was justified, right?
• 10:47
  SPEAKER_02: So tighten the balance sheet from a two two to a two one.
• 10:49
  SPEAKER_02: I'm rounding, still got pretty comfortable stocks from the end user's perspective.
• 10:54
  SPEAKER_00: Just as a disclaimer with that, it's a big export number.
• 10:58
  SPEAKER_00: Like, sure, we're tracking really well and we put a lot of sales on the books, but at the end of the day, they're gonna have to try to fulfill that number at the end of the end of the day.
• 11:07
  SPEAKER_00: So uh it it's a pretty big number to live up to on the exports, which is always a little bit scary.
• 11:12
  SPEAKER_00: So it's still over two billion bushels.
• 11:15
  SPEAKER_00: That doesn't seem like it's gonna be changing anytime soon here, but very soon we'll start talking about that next year's balance sheet very, very quickly.
• 11:22
  SPEAKER_02: Yeah, for sure, for sure.
• 11:23
  SPEAKER_02: I think last thing, just you know, I I we we broke 50,000 on the Dow last week.
• 11:30
  SPEAKER_02: So I mean that's another marker if you up.
• 11:33
  SPEAKER_00: A pretty rough couple days ahead of that, right?
• 11:36
  SPEAKER_00: I'll tell you what.
• 11:37
  SPEAKER_00: It uh um a lot of choppiness through the equities and some low tech stocks, it just uh very, very choppy.
• 11:44
  SPEAKER_00: So as you get towards the top of these ranges, you you do tend to see that a lot.
• 11:48
  SPEAKER_00: You know, as you put in record highs, it just uh it gets a little bit more volatile in in any market that you're in.
• 11:54
  SPEAKER_00: And uh the equities have plenty going on, whether it be geopolitically, AI bubbles supposedly, all sorts of things.
• 12:00
  SPEAKER_00: So there's a lot up in the air, but Q1 looks like it's off to a pretty good start here, actually.
• 12:05
  SPEAKER_02: Yeah, for sure.
• 12:06
  SPEAKER_02: For sure.
• 12:06
  SPEAKER_02: Awesome, man.
• 12:08
  SPEAKER_00: Any final thoughts?
• 12:09
  SPEAKER_02: Hey, let's uh uh this weather.
• 12:11
  SPEAKER_00: It is gonna be really nice out this weekend.
• 12:13
  SPEAKER_00: The phone lines have been very, very quiet the last two days in the office, and I do not blame anyone for that.
• 12:19
  SPEAKER_02: It's it's it's beautiful.
• 12:20
  SPEAKER_02: We'll take this in February up in this country.
• 12:23
  SPEAKER_00: That we will.
• 12:23
  SPEAKER_00: All right, thank you for your time today.
• 12:25
  SPEAKER_02: See you, Mike.