Weekly Purcell Report

by 5m Editor
17 March 2004, at 12:00am

US - Agricultural US Commodity Market Report by Wayne D. Purcell, Agricultural and Applied Economics, Virginia Tech.

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The April lean hogs are trading up around the $65 level in Tuesday's session.

You can either use the fairly steep uptrend line on this chart or just forward price these March and early April hogs at these levels if they are offering excellent profits, and for most producers, that would be the case.

When we look beyond the current market, with the April trading around $65 and the July contract around $66, I am not ready to price the summer hogs.

We normally see a significant seasonal improvement in price between the March-April timeframe when the fall pig crop comes to market and the summer months when the daily supply levels are down significantly.

This market continues to get help in some arenas because of our inability to ship beef and some of our world level buyers are turning to pork.

So long as that situation continues, we will have a boost on the demand side for pork and keep prices up.

I do believe it is worthwhile to carry the risk in the cash market on the summer hogs and look for better prices than the prices we are seeing this week.

5m Editor