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Pork Futures: Hogs End Up Sharply

by 5m Editor
5 April 2008, at 5:02am

CHICAGO - Chicago Mercantile Exchange lean hogs closed sharply higher Friday, with October and December limit up, on fund buying, short covering and buy stops.

Pork bellies ended higher, live cattle closed firm and most feeder cattle contracts posted modest gains.

Pork contracts jumped at the start, prodded by leftover buying and shorts ringing the register before the weekend. Pork cutout's recovery and improved calculated packer profit margins attracted buyer interest. That kept spot April above technical supports and catapulted nearby June beyond first-level 10-day moving average resistance.

Despite pulling back from morning highs due to sporadic selling into rallies by short-term longs, swine futures continued their upward climb amid cash hog prices that were reported higher as the session progressed.

Fund buying and buy stops developed after the contract rolled through second-level 20-day moving average resistance.

And, some hog market bulls were motivated by talk that a few Midwest hog producers are curbing ractopamine use, which sparked unconfirmed speculation that some of that pork may be destined for China. Ractopamine, commonly known as Paylean, is a feed additive that is widely used in U.S. pork production but banned in China.

Source: FXstreet.com

5m Editor