Lean Hog Leg and Shoulder Primal See Sharp Gains as Market Strengthens

TestnetNomad · 2026-02-04T01:11:21+00:00

Lean hog futures showed strong gains on Thursday, driven by market optimism. Key contracts rose significantly, with the hog leg segment leading increases. Despite a slight drop in USDA prices, robust demand and supply dynamics indicate a bullish outlook for pork products through spring 2026.

TestnetNomad

2026-02-04 01:11:21

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Lean hog futures demonstrated continued strength on Thursday with the hog leg complex benefiting from broader market optimism. The session saw significant upward movement across multiple contract months, signaling sustained investor interest in pork commodities during the early 2026 trading period.

Futures Contracts Post Solid Advances on Market Rally

The hog leg and shoulder segments led the price gains, with contracts advancing between 50 to 75 cents and establishing new highs for their respective contracts. Feb 26 Hogs finished at $88.475, climbing $0.625 from the previous session. Apr 26 Hogs closed at $96.350, up $0.750, while May 26 Hogs settled at $99.775, an increase of $0.500. These consistent gains across the forward curve suggest a balanced bullish sentiment extending well into the spring months.

USDA Pricing Metrics Point to Sustained Margin Pressure

The USDA’s national base hog price was reported at $83.09 on Thursday afternoon, representing a $2.04 decline from the prior day. However, this retreat was more than offset by the pork carcass cutout value, which surged 64 cents to $94.62 per cwt. The hog leg maintained strength while the rib primal was the only major component showing weakness in the Thursday PM assessment. The CME Lean Hog Index gained another 37 cents on Jan 20, reaching $82.40, underscoring the resilience of underlying market fundamentals.

Supply Activity Provides Context for Price Movement

Federal hog slaughter on Thursday reached 490,000 head, bringing the weekly total to 1.886 million head after an 8,000 head downward revision to Wednesday’s count. This represented 87,000 fewer head than the prior week but 82,281 more than the corresponding week last year. The seasonal supply dynamics, combined with the hog leg component’s strength, suggest processing activity remained consistent with seasonal norms while price pressures continued building from the demand side.

The sustained advance in futures pricing, particularly across hog leg-related cuts and the forward months, indicates market participants are pricing in continued strength for pork products well into spring 2026.

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