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LH Beef Substitution

The year-over-year rate of change in live cattle futures, z-scored over two years, as the slow retail-protein substitution tide under pork prices.

At a glance

As of Oct 30, 2026. Updated nightly.

OBJECTIVE

When beef prices rise sharply year over year, retail buyers at the grocery counter, the restaurant chain, and the Mexican import warehouse quietly shift toward pork at the margin. The retail cross-price elasticity between beef and pork sits around 0.15 to 0.30 in the standard USDA elasticity work. Not high. Enough to matter. On May 16, 2022, as the US cattle supply tightened after the 2021 drought liquidation and front-nearby live cattle rallied through 143 cents per pound, the composite entered its expensive-beef regime at -0.891 and lean hogs rose 38.4 percent over the next 60 trading days as the retail demand pull compounded with the pork-export recovery. On March 9, 2021, as the post-pandemic beef cycle extension resumed, the composite registered plus 0.585 and lean hogs rose 37.1 percent as classical substitution reasserted itself. Today the composite reads -0.891 as of Oct 30, 2026, in Moderate-Negative state 84 trading days running. Here is the twist. This signal is directionally correct but modest in magnitude. The expensive-beef state has delivered mean lean hog forward 60-day returns of plus 0.58 percent, only 0.33 pp above baseline. The cheap-beef state has delivered plus 0.15 percent, essentially flat. Retail protein substitution is real, but at the futures-price level it is diluted by feed-cost shocks that hit both markets simultaneously and by slow retail pass-through. Read on for three cases that frame how to read this signal, the state-conditional evidence that back-tests the modest edge, and the four caveats including why the 2020 pandemic readings should be set aside.

LIVE CHART

STATE-CONDITIONAL EDGE

THE TAKEAWAY

THE REGIME MAP

8,646 trading days observable fwd60d. Baseline mean plus 0.26 percent, median minus 0.30 percent, std 12.27 percent, pct_neg 51.4 percent.

The historical pattern

THE TRACK RECORD

Scroll inside the table for the full history. Forward 60-day LH is measured from each run’s start date; a reader cannot trade off a start-date they only identify in hindsight, so this is a transparency log, not an alpha claim. Asterisked (*) returns are partial. The run is less than 60 trading days old. The full 60-day comparable fills in as more data arrives.

Each trading day the first-nearby CME live cattle contract settlement price prints. The signal computes trailing 252-day percent change, z-scores on a trailing 504-day window with a 60-day minimum population, applies tanh. A positive composite reads expensive beef year over year. A negative composite reads cheap beef. The signal is a slow cross-protein overlay, not a tactical trigger.

Not investment advice · The analysis on this page is informational and educational. Signal readings, historical case figures, and empirical statistics are derived from publicly available data and are provided without warranty. Hypothetical performance results have inherent limitations, including the benefit of hindsight. Readers who intend to trade should consult a licensed investment professional and see the research brief for the full disclaimer.

Last refreshed Oct 31, 2026 12:33 AM ET