Weekly Purcell Agricultural Commodity Market Report Wayne D. Purcell Agricultural and Applied Economics Virginia Tech

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I would continue the program of buying back short hedges as a selective hedger with December lean hogs at $49-$50 and on dips by the February to the $52-$53 area.

Pork will be featured more in food stores, restaurants, and institutions as the record cattle and boxed beef prices continue to work up toward the consumer.

Production for quarter four is expected to be up less than 1 percent, and the breeding herd in place suggests pork production will be near 2003 levels in quarters one and two of 2004.

With demand up, we should see prices better than the $35-$36 (live base) and $42-$43 in quarters one and two, respectively, of 2003.

I do not see downside risk to be a great concern from the $49-$50 area on a lean hog basis and would buy back any short hedges and be exposed.