Pork Futures: Hogs Advance

CHICAGO - Chicago Mercantile Exchange hogs finished higher Thursday on short covering, fund buying and October longs rolling into December on eve of the final day of the Goldman roll. The roll is tied to the Goldman Sachs Commodity Index. Pork bellies ended up sharply.
calendar icon 14 September 2007
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Meanwhile, live cattle landed in slightly negative territory and most feeders ended weak.

Hogs jumped after the opening bell spurred by initial steady Missouri direct hog quotes that prompted short covering. October's oversold chart signal and relatively aggressive October/December forward spreading contributed to advances.

Pork futures gained additional ground after funds bought December as part of the roll process. That also kept December above initial 20-day and later 10-day moving average supports levels.

Nevertheless, spot-October's upward momentum at times sputtered as longs shifted October positions into December and after direct hog market quotes came in lower than anticipated.

Country hog buyers again see packers maintaining at least steady cash bids for supplies on Friday.

However, cash direction may become a bit muddled early next week as processors fight to conserve margins that sagged on Wednesday. By the same token, a few packers may pay steady-to-better money for supplies based on impressive wholesale pork demand in the face of huge hog slaughters.

While some shorts "cashed in their chips" on Thursday, others may do so on Friday, a broker said.

Source: FXSTREET.com

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