Pork Futures: Hogs Gain, May Bellies Limit Up

CHICAGO - The Chicago Mercantile Exchange lean hog futures closed higher on short covering, supportive cash, and active June/July bull spreading against spotty pre-Goldman Roll activity. Pork bellies finished sharply higher with May settling up the 300-point price limit.
calendar icon 5 May 2007
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The first of five days of the roll, which consists of funds shifting some of their spot-month June long positions into July and August, will officially begin on Monday and is tied Goldman Sachs Commodity Index.

CME live cattle posted a firm finish while feeder futures settled mostly weak.

Lean hogs at first stumbled on left-over selling after Thursday's board losses, that day's pork cutout lapse and potential bulls nervous about next week's cash prices due to unprofitable packer returns.

Market longs waded in, persuaded by Missouri direct hog's steady-to-$1.50 per hundredweight higher quote and subsequent gains at the Iowa/Southern Minnesota hog outlet. June and July's technically oversold chart conditions, and pork belly pit rally, contributed to hog break-buying that eventually helped lift contracts into positive trading territory.

Country buyers anticipate a steady to firm cash trade on Monday. However, traders holding short-term long positions remain skepitcal given the condition of estimated packer profit margins.

Source: FXSTREET.com

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