Pork Futures: Hogs Up On Short Covering, Fund Buying

CHICAGO - Chicago Mercantile Exchange hogs settled higher Thursday on short covering, fund purchases and April/June bear and June/July bull spreading.
calendar icon 23 March 2007
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Additional lift was provided by areas of cash firmness, April and June's oversold Relative Strength Index conditions and Wednesday's significant pork cutout jump. April mustered upward momentum after filling a Wednesday chart gap.

What's more, back-month hogs landed on positive turf despite Chicago Board of Trade corn's sub-par performance.

Spot April closed up 42 points at 63.80 cents a pound.

Actively-traded June closed 77 points higher at 74.32 cents.

Futures wobbled at the start due to bearish traders who contended that early cash quotes were steady at best. The concept clashed with market bulls who where emboldened by Wednesday's $1.70 pork cutout increase.

Missouri direct and terminal market cash bids trickled in up $2 per hundredweight to down $1.00. Cash followers were left wondering after major direct hog market prices were delayed by the federal government because of packer submission difficulties.

Cash sales on Friday will depend on processor needs ahead of what is expected to be a 60,000-head Saturday slaughter and heading into next week's trade.

Some fundamental traders were impressed with pork cutouts' rebound on Wednesday. However, others said that they would not be convinced that wholesale meat buyers are aggressively buying product until cutouts show consecutive gains.

Source: FXSTREET.com

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