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Pork Futures: Hogs Settle Mixed

by 5m Editor
3 April 2008, at 8:08am

CHICAGO - Chicago Mercantile Exchange lean hogs closed mixed Wednesday, and May through August drifted to new monthly lows, amid cash pressure, April/June and June/July bear spreads and corn future's upswing.

Pork bellies settled higher, live cattle ended lower and feeder cattle posted sharp losses.

Spot-April and nearby-June lean hogs vacillated, fanned by follow-through selling and sporadic short covering. And while front-month premiums' to CME's hog index triggered selling into up ticks, speculators were inspired by April and June's oversold Relative Strength Index situations.

However, sluggish wholesale pork demand, tight calculated packer profit margins and uncooperative cash hog prices weighed on spot-April throughout the otherwise lackluster session. Those bearish fundamentals before April's expiration in a couple of weeks sparked liquidation either outright or through spreads.

Meanwhile, deferred hog months traded flat to higher throughout the morning due to Chicago Board of Trade corn future's significant run up.

Country hog buyers and floor traders expect steady to possibly weak cash hog prices for Thursday. That, said industry sources, depends on packer needs heading into Saturday's kill that is expected around 130,000 head.

Source: FXstreet.com

5m Editor