Pork Futures: Lean hogs close weak, this week...

by 5m Editor
9 May 2007, at 8:44am

CHICAGO - Lean hogs closed mostly weak on softening cash hog values, June longs shifting into July and August in association with Goldman Roll positioning, and triple-digit CBOT corn losses.

Fund selling, initial profit taking and technical resistance contributed to earlier front-month hog pressure. However, futures floated up from session bottoms rescued by short covering, June and July's oversold chart situations and market bulls who take a long-term view of the market based on tight supplies.

But at the end of the day, it was the skirmish between spreaders and rollers that dominated June through August board activity and more of the same expected on Wednesday.

Fundamentally, cash weakness is seen extending into Wednesday as packers trim hog bids to reinvigorate lifeless calculated packer profit margins. But how long processors will be able to maintain that strategy is questionable given the seasonal drawdown in slaughters, an admitted bullish trader said.

What's more, the trader said, the federal government's weekly Iowa/Southern Minnesota average hog weight item on Wednesday could should that producers are current in their marketings which should help cash prices over the long haul.


5m Editor