The lean hog futures market continues in a price downtrend on the daily bar chart and the bears have the solid near-term technical advantage. June lean hog futures this week hit a new contract low. The path of least resistance for prices remains sideways to lower in the near term. Fundamentally, the CME lean hog index extended its price slide for a 13th consecutive day, falling 76 cents to $73.91 (as of April 4). However, the premium in June hog futures is now less than $15.00, which signals traders anticipate a stronger-than-normal seasonal rally once the cash market finds its seasonal low. The five-year average rise in the cash index from now until mid-June is just under $10.00. A seasonal rebound is likely coming as hog slaughter typically turns lower beginning in early April, while consumer pork demand rises as grilling season begins.

Weekly USDA US pork exports sales

Pork: Net sales of 53,200 MT for 2023--a marketing-year high--were up 75 percent from the previous week and 69 percent from the prior 4-week average. Increases were primarily for China (20,200 MT, including decreases of 200 MT), Mexico (14,300 MT, including decreases of 300 MT), Japan (3,800 MT, including decreases of 100 MT), South Korea (3,200 MT, including decreases of 1,100 MT), and Colombia (2,500 MT, including decreases of 200 MT). Total net sales of 700 MT for 2024 were for South Korea. Exports of 31,500 MT were down 3 percent from the previous week, but up 3 percent from the prior 4-week average. The destinations were primarily to Mexico (12,500 MT), China (4,900 MT), Japan (4,600 MT), South Korea (2,900 MT), and Canada (1,700 MT

Neutral USDA Hogs & Pigs Report

USDA’s latest Hogs & Pigs Report estimated the March 1 U.S. hog herd at 72.86 million head, up 171,000 head (0.2%) from year-ago. The breeding herd at 6.127 million head increased 0.5% and the market hog inventory rose 0.2%. All of those categories were in line with the average pre-report trade estimates. Market hog inventories for the three lightest categories were smaller than anticipated, while spring and summer farrowing intentions were lower than expected, but that won’t likely have much if any market impact.

The next week’s likely high-low price trading ranges:

June lean hog futures--$86.00 to $93.00 and with a sideways-lower bias

May soybean meal futures--$435.00 to $469.00, and with a sideways bias

May corn futures--$6.40 to $6.60 and a sideways bias

Latest analytical daily charts lean hog, soybean meal and corn futures